Bharti Airtel sells telecom towers in Zambia, Rwanda to IHS in lease-back deal
15 Dec 2014
Bharti Airtel has entered into an agreement to sell its 1,100 telecom towers in Zambia and Rwanda to African mobile phone operator IHS Holding Ltd, and lease them back under a 10-year renewable contract.
The financial terms of agreement, which is subject to statutory and regulatory approvals, were not disclosed. IHS is expanding its African tower footprint to over 21,000 towers across five countries.
In November 20104 it had entered in to similar lease and buy back deals with American Tower for its Nigerian and Brazilian tower assets (See: After Nigerian sale, Bharti to sell towers in Brazil to ATC)
The agreements will allow Airtel to deleverage through debt reduction, and significantly reduce its on-going capital expenditure on passive infrastructure in these African markets, Bharti Airtel said in a statement.
''We are delighted to partner with IHS, which has a proven track record in passive infrastructure management in Africa and look forward to working with them. This agreement will accelerate infrastructure sharing amongst operators and benefit customers in form of affordable tariffs and wider network coverage,'' Christian de Faria, Bharti's managing director and CEO for Africa said.
For IHS, the acquisition is another major step towards the scale needed to provide shared telecoms infrastructure solutions in Africa. IHS customers, the mobile network operators, will benefit from lower operating costs, expanded network coverage and accelerated network roll out times, higher network capacity and improved quality of service.
The consequences for the mobile subscribers will be more stable networks, higher network uptimes in which to make calls and a more ubiquitous service across the country.
''We have been working with Airtel for many years. And we are very pleased to have signed our first Buy and Lease Back transaction with Airtel. The opportunity to expand our East African business bringing IHS' market leading energy and infrastructure management practices to a wider market is an excellent opportunity,'' said Issam Darwish, IHS' executive vice chairman and group CEO.