Nigeria is set to remain a key market in MTN Group’s proposed $6.2 billion acquisition of IHS Towers after shareholders approved the transaction which brings the telecommunications firm closer to full ownership of the tower infrastructure company.
IHS shareholders approved the merger at an Extraordinary General Meeting on August 4, clearing a major condition for MTN’s acquisition of the shares it does not already own.
Under the deal, MTN will pay $8.50 in cash for each IHS share it does not already hold. The transaction values IHS at approximately $6.2 billion on an enterprise-value basis.
The significance of the transaction for Nigeria stems from IHS Towers’ extensive infrastructure footprint in the country.
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IHS is one of the major independent owners and operators of telecommunications towers in Nigeria, providing infrastructure used by mobile network operators to deploy voice and data services.
Following its exit from Latin America, IHS will have more than 28,000 towers across five markets which are Nigeria, South Africa, Cameroon, Côte d’Ivoire and Zambia.
The consolidation would therefore give MTN greater control over an infrastructure company with a substantial presence in the Nigerian telecommunications market.
For MTN, the deal comes as telecom operators face growing demand for network capacity driven by rising data consumption, smartphone adoption, digital services and the expansion of cloud and artificial intelligence applications.
Tower infrastructure is important to this expansion because operators require reliable sites, power systems and connectivity infrastructure to increase network capacity without duplicating infrastructure.
The acquisition can also reshape the relationship between MTN and one of the major infrastructure providers supporting Nigeria’s telecom ecosystem.
However, the transaction is not yet complete. IHS and MTN still need to satisfy the remaining regulatory and other closing conditions before the merger can be completed.
The shareholder approval nevertheless removes one of the major corporate hurdles standing between MTN and full ownership of IHS Towers.
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