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4G/5G

MTN Provides Loan Boost to IHS Towers

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MTN Group has assigned a "shareholder loan" of US$231 million to IHS Holding, the mobile tower infrastructure specialist with which MTN has a joint venture in Nigeria.

Through that joint venture, created in 2014, IHS Holding owns and operates the mobile towers used by MTN Nigeria, the country’s leading mobile service provider with a 37% market share.

The loan, made through MTN Nigeria Towers, "allows MTN Nigeria to continue to invest in its network more efficiently, and further simplifies MTN's interests in IHS," and "will enable MTN and IHS to mutually benefit from continued investment and commitment to the rollout of broadband and data services in Nigeria."

The loan, though, will have a negative impact on MTN's 2017 financials: The operator will result in a 2.8 billion South African rand ($228 million) loss that will impact its earnings per share (EPS) and headline earnings per share (HEPS) for 2017 but not its earnings before interest, tax, depreciation and amortisation (EBITDA).

MTN Group had reported a profit for the first half of 2017 following a turbulent 2016. (See MTN Returns to Profit in H1 2017.)

News of the move comes as MTN Nigeria shapes up to a potential challenge for its market leadership, as its two nearest rivals, Airtel and Globacom, are both in the five-strong shortlist to acquire the market's number four player, 9Mobile. (See 5 in Line to Acquire Nigeria's 9Mobile.)

— Ray Le Maistre, International Group Editor, Light Reading, for Connecting Africa

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