Bharti Airtel on Monday said it had signed an agreement with American Tower Company (ATC) to sell about 4,800 of its telecom towers in Nigeria, as part of a debt-reduction exercise.
This is the third time in four months that the company is selling its mobile towers in Africa. Of the 15,000 towers it had in the region earlier, the company had sold 3,500 to Eaton Towers in September and 3,100 to Helios Towers two months before that.
Bharti did not disclose financial details but the latest deal was estimated to be worth at least $ 1 billion (about Rs 6,200 crore). Among the 17 African countries where Bharti has operations, the valuation of its towers is the highest in Nigeria. Given that the towers in earlier transactions — such as the Millicom deal for 1,000 towers in Tanzania and the MTN deals in Ivory Coast, Uganda and Cameroon — were valued between Rs 73 lakh and Rs 1 crore apiece, the Nigerian towers are estimated to be worth about Rs 1.25 crore each.
“The agreement will allow Airtel to focus on its core business and customers, enable it to deleverage through debt reduction, and will significantly reduce its capex on passive infrastructure in Nigeria,” the company said in a statement.
After the deal, Airtel would continue to be the anchor tenant on the portfolio, with a 10-year initial lease term, it added.
ATC and Airtel expect to close the acquisition during the first half of 2015, subject to customary closing conditions and regulatory approvals.
“With the largest population and economy in Africa and a relatively underdeveloped wireless infrastructure, we view Nigeria as a tremendous growth opportunity. Further, we expect this investment to support our long-term objective,” said Jim Taiclet, chairman, president & chief executive of ATC.
Christian de Faria, MD & CEO of Bharti Airtel Africa, said: “Nigeria is a key market for Airtel. This agreement will give us considerable cost efficiencies and allow us to sharpen our focus on customers.”