MTN Group, Africa’s biggest GSM operator, said it had assigned a $231 million shareholder loan to tower group, IHS Holding Ltd, impacting on its 2017 profits.
MTN, which returned to profit in the first half of its financial year in the absence of one-off charges related to a $1.1 billion Nigerian fine, said the assignment of the loan to IHS will lead to a loss of 228 million dollars on transfer of the carrying value of the loan.
MTN said the loan, which is due in 2024/2025, will allow its Nigerian unit to continue to invest in its network and simplify MTN’s interests in IHS.
“The agreement will enable MTN and IHS to mutually benefit from continued investment and commitment to the rollout of broadband and data services in Nigeria,” MTN said in a statement.
MTN formed a joint venture partnership with specialist tower company IHS in 2014 to own and operate MTN’s transmitter towers in Nigeria.
It would be recalled that Africa’s largest GSM Network, MTN Group recently exchanged its 51% interest in Nigeria Tower Interco BV,for additional shareholding in IHS Holding Limited.
Executive Chairmanof the Group Phuthuma Nhleko speaking while signing the partnership deal said
“the transaction represents a significant step in MTN’s long-standing partnership with IHS. It simplifies our ownership structure and diversifies our tower investments across the IHS Group. IHS Group is extremely well positioned for future growth and build-out from 3G upgrades and the move to long-term evolution across its key markets.”
The deal which was intended to simplify tower ownership structure and diversify its tower infrastructure exposure across the IHS Group which already operates in a number of markets across Africs. It also saw MTN increase its stake in IHS from 15% to 20%.
IHS has operations in Nigeria, Cameroon, Cote d‘Ivoire, Rwanda and Zambia. IHS Group is the largest independent tower operator in Africa with over 23,300 towers and providing 40,000 direct and indirect jobs across Africa.