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Africa's largest mobile operator, MTN, said on Thursday it has selected American Tower Corporation (ATC) as its preferred bidder to take over its tower services in Nigeria from 2025, replacing IHS Towers, with whom it has a tense relationship.
MTN Nigeria said in a statement ATC Nigeria Wireless Infrastructure Solutions was selected on the basis of its superior bid submission, with this concerning about 2 500 network sites.
"Additionally, this will further diversify our site portfolio and align with our proactive initiatives to renegotiate tower agreements, focusing on ensuring terms that will cushion the business from the volatility in our trading environment," it said in a statement.
The extensive trading relationship between New York-listed IHS - which was founded in Nigeria - and MTN has been cited by the former as a reason to deny the mobile operator board representation.
MTN holds 26% of IHS, which operates nearly 40 000 towers in Africa, the Middle East and South America, but its voting rights are capped at 20%. MTN doesn't have a representative on the IHS board, although its former CEO, Phuthuma Nhleko, is a non-executive director.
Earlier in 2023, MTN, along with French investment company Wendel – which owns 19% – demanded that those holding 10% or more of IHS get to nominate board members, but this had been dismissed by IHS.
They had demanded an extraordinary general meeting in June, though this was denied, with IHS Towers saying at the time its board had unanimously determined that the recent shareholder proposal from MTN was "not in the best interests of IHS Towers as a whole or our collective shareholder base".
The group said it declined the request to submit the proposal, which was in accordance with its articles and shareholder agreement. "MTN does not have the right to call an extraordinary general meeting under our articles or shareholder agreement," it said at the time.
"IHS Towers remains focused on increasing shareholder value and will continue to engage with MTN as we do with all our shareholders."
READ | MTN demands extraordinary meeting amid battle with NYSE-listed IHS
The company said MTN’s voting rights have been capped at 20% since 2014 per agreement in order to preserve its independence and account for the fact that MTN is its largest customer. MTN's various African operations accounted for almost 62% of its revenue in IHS's 2022 year, including Cameroon, Rwanda and Zambia. Also in 2022, it entered the SA market by acquiring about 5 700 towers in South Africa from MTN for a cash consideration of R6.4 billion.
As part of its asset realisation programme, announced in 2019, MTN had also sold its stakes in ATC Uganda and ATC Ghana for R8.9 billion in total.
