MTN to take full control of IHS Towers in deal valuing it at $6.2 billion

By Nqobile Dludla

JOHANNESBURG, Feb 17 (Reuters) - MTN Group MTNJ.J has agreed to take full control of IHS Holding IHS.N, buying the roughly 75% stake it does not already own in a deal that values the tower operator at about $6.2 billion, the companies said on Tuesday.

MTN, Africa's biggest mobile operator, will pay $8.50 per share in cash. The deal will be funded through the rollover of MTN's existing stake of around 24% in IHS, as well as about $1.1 billion in cash from MTN, roughly $1.1 billion from IHS' balance sheet, and the rollover of no more than existing IHS debt, the tower operator said in a statement.

With the deal, South Africa-based MTN returns to direct ownership of thousands of towers it originally built and later sold to IHS, reversing a decade‑long shift across the industry toward outsourced tower leasing.

Regaining control of the assets will cut long‑term rental costs for MTN and give the operator greater flexibility over future 5G and fibre rollout.

The offer price represents a 36% premium to the 52‑week volume‑weighted average price of IHS' stock and a 3% premium over its February 4 closing price, when reports surfaced that talks with MTN were under way, the company said.

"This proposed transaction is a pivotal step in further strengthening MTN Group's strategic and financial position for a future where digital infrastructure will become ever more essential to Africa's growth and development," MTN Group President and CEO Ralph Mupita said.

The IHS board has unanimously approved the agreement and will recommend it to shareholders, the company said.

Besides MTN, which is the largest shareholder, long‑term shareholder Wendel MWDP.PA has also agreed to vote in favour of the deal.

Upon closing, Wendel will receive approximately $535 million for its 19% stake in IHS, the European investment firm said in a separate statement.

Earlier on Tuesday, IHS agreed to sell its Latin America tower operations in Brazil and Colombia to Macquarie Asset Management. MTN will only own nearly 29,000 IHS towers in Africa.

Once the deal is completed, IHS will be taken private and become a wholly owned subsidiary of MTN, the mobile operator said in a separate statement.