MTN Group is seeking local investors to acquire a 30 percent stake in IHS Nigeria Plc, as part of an agreement with Nigerian competition authorities.
According to a Bloomberg report on Thursday, people familiar with the matter said the proposed transaction could raise between $900 million and $1.1 billion.
MTN Group Chief Executive Officer Ralph Mupita said proceeds from any sell-down would be used to reduce debt linked to IHS.
“The deal would be done on market-oriented valuation basis,” Mupita said in an interview, declining to provide financial details.
MTN had agreed to sell part of its interest in IHS Nigeria to local entities under an arrangement with Nigeria’s competition regulator. The proposed sale is intended to satisfy regulatory requirements attached to MTN’s planned consolidation of its interest in the tower company.
Earlier this year, MTN announced plans to acquire the roughly 75 percent of IHS Nigeria that it does not already own, paving the way for full ownership of the Nigerian tower business.
MTN said the transaction would result in the group owning 100 percent of IHS’s African tower portfolio, following the completion of IHS’s announced disposals of its Latin American fibre and tower businesses.
The telecoms giant offered $8.50 per share, representing a 9.7 percent premium to IHS’s 30-day volume-weighted average price as of February 4, the last trading day before MTN issued a cautionary notice.
IHS Nigeria operates about 18,000 telecommunications towers, supporting mobile network infrastructure across the country.
The proposed local-investor stake sale would allow MTN to meet regulatory requirements while raising funds that could help reduce debt associated with its IHS investment.
