MTN Clears Regulatory Hurdle in $2.2bn IHS Towers Acquisition

MTN Group has cleared another regulatory hurdle in its proposed $2.2 billion acquisition of IHS Towers, as the South African Competition Tribunal authorised the transaction following a recommendation by the Competition Commission.

The approval comes with public-interest and market-conduct conditions aimed at addressing potential competition concerns in the telecommunications sector, including measures relating to market fairness, existing customers and local employment.

Under the proposed transaction, MTN will acquire the shares in IHS Towers that it does not already own for approximately $2.2 billion, taking its stake to 100% and paving the way for the tower company to be taken private. MTN currently holds about 24.7% of IHS.

IHS Towers operates nearly 29,000 towers across Africa and serves multiple mobile network operators in key MTN markets. MTN said in February that the acquisition would enable it to reintegrate critical digital infrastructure, internalise margins currently paid to IHS, improve cost predictability and unlock value from its existing investment.

Why MTN is buying back IHS Towers

Tower infrastructure is a critical component of mobile telecommunications, providing the physical sites required to support network connectivity. By bringing IHS back under its ownership, MTN expects to gain greater control over the infrastructure supporting its operations while reducing its reliance on third-party tower leasing.

The acquisition is also expected to provide MTN with greater cost visibility and allow it to benefit from revenue generated by third-party customers using the tower network. The company has described the transaction as a means of strengthening its digital infrastructure platform and creating long-term value.

The scale of IHS's African network also provides MTN with an extensive infrastructure base as demand for mobile data and digital connectivity continues to grow across the continent.

From asset sale to infrastructure ownership

The acquisition represents a shift from the asset-light strategy that saw telecommunications operators sell passive infrastructure to specialist tower companies while retaining access to the sites through lease agreements.

In 2022, IHS completed the acquisition of 5,701 towers from MTN South Africa for R6.4 billion. The transaction also involved MTN leasing space back on the towers, with associated lease liabilities estimated at about R4.6 billion.

At the time, the arrangement formed part of MTN's asset realisation strategy, allowing the group to release capital from its tower infrastructure while IHS took responsibility for operating the assets.

MTN's proposed acquisition of IHS would reverse that structure at group level, bringing the tower assets back under MTN ownership and giving the telecommunications group greater direct control over a key part of its digital infrastructure.

MTN said the proposed transaction is expected to be accretive to revenue, profit after tax and adjusted headline earnings per share. The company also said regulatory approvals had been received in several markets, including Nigeria, with the remaining approvals required before completion.

Subject to the outstanding approvals and other closing conditions, MTN had previously indicated that the transaction was expected to close in the second half of 2026.