MTN has announced the conclusion of an agreement to dispose of its 49 per cent equity holdings in the Ghana and Uganda Tower Company investments to a subsidiary of American Tower Company (ATC) for $523 million, approximately R7.3 billion. The transaction is expected to close in the first of 2020.
The South Africa-based telco group has also confirmed that MTN Nigeria has completed the redemption of its preference shares with MTN Group receiving, in December 2019, an amount of US$315 million (about R4,4 billion).
Ghana Interco and Uganda Interco were formed when MTN sold its towers in Ghana and Uganda to its joint ventures with ATC in 2011 and 2012 respectively. MTN holds 49 per cent in Ghana Interco and Uganda Interco, and each of these companies subsequently hold 100 per cent in ATC Ghana and ATC Uganda respectively. The two firms – Ghana Interco and Uganda Interco – own and lease tower assets in their respective jurisdictions.
The transactions are also a followup to ATC’s acquisition of Eaton Towers.
Commenting on the transactions, Rob Shuter, MTN’s Group President and CEO said: “Following the completion of these transactions, MTN will have realised proceeds of approximately R14 billion within the first 12 months of this program. Realising proceeds from simplifying the group remains a major strategic objective and we expect further progress in this program in 2020.”
The transactions are part of MTN’s Asset Realisation Programme (ARP) announced in March 2019 through which the group aims to simplify its portfolio, reduce debt and risk, improve returns and realise proceeds of at least R15 billion over three years.
The East Africa and Nigeria transactions are a follow up to the proceeds raised from the disposals of MTN Group’s stakes in Amadeus, Travelstart and the ATC loan of R2,1 billion earlier in the year.
As of June 2019, MTN had achieved R2.1 billion of the three-year R15 billion target announced in March of the same year.