MTN Tables R35.3bn Offer to Buy Out IHS

MTN Group has agreed to buy out minority shareholders in IHS Towers. The deal would bring nearly 29 000 telecom towers across Africa back under its direct control. It reverses years of divestments in which MTN sold passive infrastructure to tower operators.

The IHS board has accepted an offer of US$8.50 per share, a 9.7% premium to the 30-day volume-weighted average price prior to MTN’s cautionary announcement on 5 February, valuing the remaining shares at approximately $2.2 billion (R35.3-billion).

MTN currently holds a 24.7% stake in IHS. It now plans to acquire the remaining shares through a cash merger that would lead to a delisting from the NYSE. About $1.1 billion will be funded from cash on IHS’s balance sheet. The balance will come from MTN’s liquidity and debt facilities. No new MTN shares will be issued.

A Change in Infrastructure Strategy

Over the past decade, MTN adopted an asset-light model. It sold thousands of towers under sale-and-leaseback agreements. The approach released capital for network expansion. It also required MTN to lease back infrastructure it once owned.

The shift included the sale of 5 700 South African towers to IHS in 2022 for R6.4-billion. IHS had listed on the NYSE in October 2021 at $21 per share. That is more than double the current take-private offer.

The proposed buyout takes MTN in a different direction. By acquiring the remaining stake, the group would regain control of the assets and the related cash flows. Full ownership would allow MTN to retain margins paid to IHS. It would also give the group direct exposure to third-party leasing revenue and tighter control over long-term infrastructure costs.

Shareholder and Regulatory Process

The transaction remains subject to shareholder approval and regulatory clearances. Long-term IHS shareholder Wendel has committed to vote in favour of the deal. That commitment gives MTN about 40% of the required two-thirds approval threshold.

MTN Group CEO Ralph Mupita said the transaction strengthens the group’s position as digital infrastructure becomes more central to its operations.

IHS chairman and CEO Sam Darwish said the deal combines Africa’s largest mobile operator with one of its largest independent tower platforms.

If approved, the acquisition will materially increase MTN’s direct ownership of infrastructure assets. It will also close the chapter on the tower divestment strategy the group pursued over the past decade.