MTN's $6.2 Billion IHS Towers Acquisition Faces Nigerian Regulatory Scrutiny
MTN Group's proposed $6.2 billion acquisition of IHS Towers will undergo regulatory review in Nigeria, where concerns over market concentration and infrastructure control have prompted government oversight of the transformative deal.
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MTN Group has entered into a definitive agreement to acquire IHS Towers for $6.2 billion in a transaction that would consolidate Africa's largest mobile operator with one of the continent's premier telecommunications infrastructure providers, according to Premium Times. The deal, which requires multiple regulatory approvals across IHS Towers' operating markets, will result in the tower company delisting from the New York Stock Exchange upon completion.
Nigeria's Ministry of Communications has signaled it will conduct a comprehensive regulatory assessment of the transaction, with Techpoint Africa reporting the review will focus on competition dynamics, infrastructure control, and broader implications for the telecommunications sector. The scrutiny reflects Nigeria's position as a critical market for both companies, with IHS Towers operating approximately 30,000 tower sites across the country and MTN Nigeria representing the group's largest operation by subscriber base and revenue contribution.
The acquisition would mark a strategic shift for MTN, which has historically operated under lease agreements with independent tower companies including IHS Towers. Industry analysts note the vertical integration could provide MTN with greater control over network infrastructure costs, which have escalated due to naira depreciation and diesel price inflation affecting tower operations. However, the concentration of tower assets under a single mobile operator raises questions about access terms for competing carriers including Airtel Nigeria and 9mobile, which also lease capacity from IHS Towers' Nigerian portfolio.
"The transaction requires various approvals for it to reach closure, and IHS will give up its quoted company status by delisting from the New York Stock Exchange once the whole process is concluded," Premium Times reported. The delisting process will require IHS Towers to navigate U.S. securities regulations alongside African regulatory frameworks, adding complexity to the transaction timeline. IHS Towers, which operates across Nigeria, Cameroon, Côte d'Ivoire, Rwanda, and Zambia, has traded on the NYSE since October 2021 following an initial public offering that valued the company at approximately $7 billion.
The regulatory review in Nigeria will likely examine whether MTN's ownership of tower infrastructure creates barriers to entry for potential new mobile operators or disadvantages existing competitors through preferential access or pricing. Nigeria's National Communications Commission, which oversees telecommunications licensing and competition matters, has previously intervened in market concentration issues, including blocking MTN's attempted acquisition of Visafone in 2015 over spectrum dominance concerns. The commission's framework for infrastructure sharing mandates non-discriminatory access to essential facilities, principles that may require modification or enforcement mechanisms under MTN ownership.
Beyond Nigeria, the transaction will require approvals from competition authorities and telecommunications regulators in each jurisdiction where IHS Towers maintains operations. The deal structure and financing arrangements have not been publicly disclosed, though the $6.2 billion valuation represents a significant premium to IHS Towers' recent market capitalization, which has fluctuated between $4.5 billion and $5.8 billion over the past twelve months according to NYSE trading data. MTN Group reported total assets of 436 billion rand ($23.8 billion) as of December 2024, with the acquisition potentially requiring debt financing or asset disposals to complete.
The consolidation comes as African telecommunications operators face pressure to optimize capital expenditure amid currency volatility and rising operational costs. Tower companies have traditionally provided mobile operators with capital-light expansion models, allowing carriers to lease rather than own infrastructure. MTN's decision to acquire rather than lease suggests a long-term strategic calculation that ownership economics have become more favorable, particularly as 5G network deployment accelerates across the continent and tower modification requirements increase.
Completion timelines for the transaction remain uncertain pending the outcome of regulatory reviews across multiple jurisdictions. Nigerian authorities have not specified a timeframe for their assessment, though complex telecommunications mergers in the market have historically required six to eighteen months for approval. The deal's closure will depend on satisfying conditions precedent in each operating market, creating potential for extended negotiations or structural modifications to address regulatory concerns.