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Bharti sells tower assets in Nigeria to ATC

By on November 26, 2014

Bharti Airtel monday said it signed an agreement with American Tower Company (ATC) to sell more than 4,800 telecom towers in Nigeria as part of the debt reduction exercise.

This is the third time in the past four months that Bharti has sold its towers in Africa.
The company had sold about 3,500 towers to Eaton Towers in September and had also sold 3,100 towers to Helios Towers across Africa two months before the Eaton deal. Bharti had about 15,000 towers in African region.

While Bharti has not disclosed the financial details, the deal is estimated at more than $1 billion (about Rs 6,200 crore), according to Business Standard.

Of 17 countries in Africa where Bharti has operations, the valuation is higher at Rs 1 crore each in Nigeria. In earlier deals in the tower infrastructure space in Africa, such as in Tanzanian firm Millicom’s deal for 1,000 towers and MTN’s deals in Ivory Coast, Uganda and Cameroon, one tower was valued between Rs 73 lakh and Rs 1 crore.

“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 on-going capital expenditures on passive infrastructure in Nigeria,” the company said in a statement.
Post deal, Airtel will continue to be the anchor tenant on the portfolio under a lease with a ten-year initial term, it added.

ATC and Airtel expect to close the acquisition during the first half of 2015, subject to customary closing conditions and regulatory approval.

“With the largest population and economy in Africa and relatively underdeveloped wireless infrastructure, we view Nigeria as a tremendous growth opportunity. Further, we expect this investment to support our long-term objective,” the Chairman/President and Chief Executive Officer of ATC, Jim Taiclet said.

Commenting on the development, the Managing Director/Chief Executive Officer, Bharti Africa, Christian de Faria said: “Nigeria is the largest mobile market in Africa and a key one for Airtel. This agreement will provide us with considerable cost efficiencies and at the same time allows us to sharpen our focus on the customer.”

The ATC is a publicly held company that is a leading owner and operator of wireless and broadcast communications sites in North America. American Tower is headquartered in Boston, Massachusetts and has local offices worldwide.