MTN, US firm in Uganda tower venture
Pan-African mobile operator MTN Group and American Tower Corporation (ATC) are to establish a new joint venture tower company in Uganda that will acquire MTN base station towers in that country for approximately US$175-million.
ATC Uganda, which will own about 1 000 base station towers, will be managed by American Tower, and controlled by a holding company of which American Tower will hold a 51% stake and MTN Group the remaining 49%.
MTN Uganda will be the anchor tenant, on commercial terms, on each of the towers being purchased.
“Infrastructure sharing makes absolute sense for MTN and we expect it to play a significant role in reducing our long-term infrastructure costs,” MTN Group chief executive Sifiso Dabengwa said in a statement last month. “The Ugandan market has presented us with an opportunity to continue to build on our strong working relationship with the experienced team at American Tower.”
MTN owns approximately 33 000 base station towers across its 22 operations in Africa and the Middle East.
“Because market conditions in each of the markets are unique, we will continue to evaluate infrastructure sharing opportunities on a market by market basis going forward,” said Dabengwa.
Independent tower operations
American Tower is a leading independent owner, operator and developer of broadcast and wireless communications sites in the United States, Brazil, Chile, Colombia, India, Ghana, Mexico, Peru and South Africa.
In November 2010, South African mobile operator Cell C sold over 3 000 of its base station towers to American Tower in a $430-million deal.
American Tower expects that ATC Uganda will build approximately 280 tower sites for MTN Uganda over the next three years, as well as pursue opportunities to build tower sites for other wireless operators in Uganda.
American Tower CEO Jim Taiclet said the company’s strategy was to invest in select African markets with strong wireless growth potential and a positive investment climate
“In addition, we are building upon our successful partnership with MTN in Ghana where our tower expertise, operational excellence and a focus on delivering growth and value from the asset portfolio, are highly complemented by MTN’s regional operational experience,” he said.
The deal is expected to be finalised in the first half of 2012, subject to usual regulatory approvals, upon which ATC Uganda will become the largest owner and operator of base station tower sites in that country.