MTN Group’s decision to acquire 100% of IHS Towers reflects a strategic U-turn from the asset-light model it had been pursuing, but it doesn’t mark the start of a broader industry trend, a leading industry analyst has said.
Other operators globally and in South Africa have pursued a similar approach over the past decade, with the likes of Vodafone Group and AT&T also selling their towers to unlock capital for 5G deployments while streamlining operations. In South Africa, both Cell C and, more recently, Telkom have sold their towers.
Speaking to TechCentral in an interview on Friday, Africa Analysis MD Andre Wills said the move by MTN is unlikely to be a marker for the reversal of the trend. Rather, the move was driven by circumstances unique to the relationship between MTN and IHS.
“Why do you offload your assets to start with? Because it’s an opportunity to convert assets to capital. Secondly, you’ll see an uptick in Ebitda (earnings before interest, tax, depreciation and amortisation) because your lease obligations drop to depreciation and amortisation, so from a valuation perspective you start to look better,” said Wills.
“MTN already owned 25% of IHS, and my suspicion is that there are long-term lease obligations that MTN has to pay out. So, this is a way to look at the balance sheet and perhaps restructure it.”
The deal, worth US$2.2-billion (R35.3-billion), will see MTN acquire the remaining 75.3% of IHS it does not already own. The deal is subject to IHS disposing of its Latin American assets, consisting of some 8 860 sites.
Reintegration
IHS announced last week that its Latin American operations would be sold to Macquarie Asset Management for $952-million, leaving MTN to inherit some 29 000 towers across five key African markets: Nigeria, South Africa, Zambia, Cameroon and Ivory Coast. MTN has operations in all of these markets.
The reintegration of the tower infrastructure will reflect as an increase in assets on MTN’s balance sheet and eliminate long-term lease liabilities. MTN has also mentioned the internalisation of margin paid to IHS as another benefit of the acquisition, but there may be other, non-financial drivers behind the proposed deal.
Read: MTN to buy back its own cellular towers in R35-billion deal
Despite being IHS’s largest shareholder, MTN’s voting rights in IHS were limited because of the tower operator’s corporate structure. The relationship came to a head in 2023 when MTN accused IHS of poor corporate governance, demanding it be given more influence over the IHS board.
MTN has also had to wrangle with instability regarding its tower leases, especially in Nigeria where currency volatility has dominated the macroeconomic environment over the last three years. In 2024, MTN renegotiated its lease contracts with IHS such that a higher proportion of costs were naira-denominated, reducing US dollar exposure.
Wills said that while it is possible that other mobile operators could move to acquire their outsourced tower partners, it is unlikely.
“When operators decide if they want to buy back their towers, they will really look at it on a country-by-country basis. The other aspect is that you have to have the balance sheet to support this type of acquisition because it is by no means a small purchase,” said Wills.
Market conditions in different countries call for different strategies regarding infrastructure. MTN rival Vodacom, for example, has in South Africa also shifted its approach to masts and towers. Instead of a complete disposal, however, Vodacom South Africa in 2022 announced plans to spin out its 9 500-plus base stations into a separate business. The rationale behind this move is about unlocking value while maintaining control.
Vodacom’s strategy in South Africa differs from its approach in other parts of Africa. The Democratic Republic of Congo is a standout example. The DRC is a massive territory with large stretches of jungle separating sparse rural communities across the country. The geography makes the building and management of tower infrastructure particularly expensive; this has forced Vodacom and its competitor Orange to join forces – and resources – to attack the problem.
“Where infrastructure is easy to roll out there is probably no incentive to share,” said Wills.
Policy and legislation also play a role in the approach mobile operators take towards infrastructure ownership. In Egypt, for example, the government provides strong incentives for infrastructure investment, including eased licensing for masts and towers, tax deductions and support for local equipment manufacturing. This has led to Vodacom Egypt opting to own its infrastructure instead of pursuing an asset-light strategy.
Cell C example
Market structure and relative positioning also play a role in strategic thinking. South Africa’s Cell C saw the operation of its own masts and towers as a massive cost relative to its size as the smallest of four operators in the country.
Cell C began offloading its 5 500 towers from 2021. Instead of leasing dedicated capacity from an independent towerco, however, Cell C opted for a roaming-only model atop Vodacom and MTN infrastructure. This eliminated network-related capex spending in favour of lower opex spent on roaming agreements.
Read: MTN is eyeing East Africa for future growth
“If you have a small, singular operator in a country they are not going to go and buy the likes of IHS. If you look across the African continent, it is really the mobile operator groups that have any form of balance sheet that could lend itself to buying a tower company,” said Wills. — (c) 2026 NewsCentral Media
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