Airtel Africa, a leading telecommunications company in Africa, on Tuesday announced it has signed deals to sell its telecommunications tower companies in Madagascar and Malawi.
The telecoms giant stated in a statement signed by Simon O’Hara Group Company Secretary, Airtel Africa.
Helios Towers Plc, a leading independent telecommunications infrastructure company in Africa, agreed to buy the two-tower companies in two separate agreements in respect of each jurisdiction.
Airtel Africa expects to close the deal around the fourth quarter of 2021.
The earnings from the deals is expected to be around $108 million. However, under the terms of the deals, the Group’s Airtel Africa’s “subsidiaries will continue to develop, maintain and operate their equipment on the towers under separate lease arrangements, largely made in local currencies, with the Purchaser. In addition, as part of the Transactions, the Group has agreed to build to suit commitments with the Purchaser for an additional 195 sites across Madagascar and Malawi over the three years following completion, for which a further $11m of
consideration is payable.”
Speaking on the deals, Raghunath Mandava, CEO of Airtel Africa, said: “With these latest tower transactions we continue to demonstrate strong execution of our asset monetisation programme. Helios Towers has been a partner to our business in some of the OPCOs for many years and we look forward to further expanding this partnership with these new leases as we together seek to improve mobile connectivity and infrastructure across Africa.
“These transactions will also help to improve the mix of our debt and increase its tenor through long term leases, which are largely payable in local currency by our operating entities, while reducing foreign currency debt of the Group.“
MTN Partners Fintechs as Talks With Banks Lingers
MTN has activated a number of new channel partnerships with fintech companies as the company continues meeting with the commercial banks on a new pricing structure agreement.
MTN’s initial meeting for the reduction of the charges held on Tuesday with the banks ended in a deadlock and is expected to continue until a new long-term agreement can be reached on a sustainable pricing structure going forward.
The telco said this in a statement on Thursday titled ‘Update on banking channel partners’ dispute and expansion of channel network’.
MTN customers were reconnected to banking channels after the banks blocked them on April 2.
This was agreed on the basis that MTN would revert to its previous cost of sales structures with banking partners, until a new long-term agreement could be reached on a sustainable pricing structure going forward.
The telecom company noted that it had been participating in a series of meetings with the banks since Tuesday, after the intervention of the Minister of Communications and Digital Economy, the Nigerian Communication Commission and the Central Bank of Nigeria.
According to the telco, the reduction in the banks’ commission on USSD airtime is ‘international standard and best practice as scale is built along distribution channels’.
“We will provide a further market update once these discussions have been concluded.
We are confident that partners in the banking sector will work with us to ensure this process concludes as quickly as possible to the benefit of the entire industry,” MTN said.
It said it had partnered with new fintechs to expand the range of channels available to customers, adding that the partnerships would remain in place.
“The new channel partners include Sparkle, Konga Pay, Barter By Flutter Wave, Jumia Pay, OPay, Kuda, Carbon, BillsnPay, MTN On Demand, MTN Xtratime airtime loans (*606#), myMTN Web http://mymtn.com.ng and Momo agent *223#,” the statement said.
The telco expressed optimism for a mutually acceptable solution that empowered all ecosystem participants.
MTN Nigeria Completes Issuance of Series III, Series IV Commercial Papers
MTN Nigeria Communications Plc announced it has completed the issuance of Series III and Series IV Commercial Papers under its N200 billion commercial paper programme.
According to the telecommunications giant, the proceeds from the Series III and IV CP Issuance will be used to finance working capital and general corporate purposes.
“The CP Issuances were undertaken in line with the Company’s strategy to diversify its financing sources. In November 2020, MTN Nigeria obtained the approval of Financial Markets Dealers Quotations (FMDQ) Securities Exchange Plc to increase the Company’s CP programme from N100,000,000,000 to N200,000,000,000; following the very successful inaugura Series I and Series II CP Issuances in June 2020. The Company confirms that the Series I and Series II CP Issuances – of an aggregate value of N100,000,000,000 – have been redeemed,” MTN Nigeria stated in a statement signed by Uto Ukpanah, Company Secretary, MTN Nigeria.
“The book build for the Series III and Series IV CP Issuances opened on Thursday, 11th March 2021 and closed on Friday, 19th March 2021. The Series III CP cleared at a discount rate of 6.7652 percent and raised N19,765,447,000; and the Series IV cleared at a discount rate of 7.5547 percent and raised N53,742,807,000. The aggregate CP Issuance is N73,508,254,000 across both tenors.”
Power Tussle; MTN Airtime Sales Resume as Nigerian Govt Intervenes in Bank Feud
MTN resumed airtime sales on banking channels Sunday after banks lifted a ban on the telco following an intervention by the Nigerian government.
Nigerian banks on Friday barred the Johannesburg-based firm from using their USSD platform to conduct business as both sides scuffled over airtime sales fees.
The three-day-long feud started after MTN, which has the biggest share of Nigeria’s telecoms market, reduced the rate it pays banks for each transaction from 4.5 per cent to 2.5 per cent.
The lenders removed the telecom giant from their platforms, disallowing MTN users from accessing their bank accounts to recharge their phones.
As subscribers expressed their frustration, MTN advised them to seek alternative ways of recharging. On Saturday, the firm announced alternative channels for its airtime sales, including a host of fintech platforms led by Flutterwave.
Service resumed Sunday afternoon after MTN agreed to revert to “status quo” at the request of the Minister of Communications, the Nigerian Communications Commission and the Central Bank of Nigeria while a permanent solution is being worked out, the news media gathered.
“The CBN Governor’s intervention is in line with our core values. We acceded to his request and that of our Minister. We will continue to live our values that ‘everyone deserves the benefits of a modern connected life’,” Carl Toriola, MTN Nigeria chief executive, said Sunday.
The telco told PREMIUM TIMES its firm’s pursuit has always found motivation in leveraging business to the fullest in the interest of customers and the Nigerian market.
“MTN’s intention has always been geared towards business optimization to the benefit of our customers and indeed the country,” Mr Toriola said.
“This is evidenced by the fact that through the USSD imbroglio, we never denied access to our customers. In the current case, customers have been denied access to services by the banks despite having monies in their accounts to purchase those services. MTN will naturally do all it can to minimise customer pain. It is not just about revenue for us. The good of our customers influence every decision we take.”
The Banks had said earlier that they were responding to check MTN’s “excesses”.
However, a source said, “the truth is that if MTN gets away with this, banks should expect further reduction if not checked. Over 60 per cent of airtime vending by telcos today are done electronically through the banks.”
They argued that the percentage MTN pays is lower than that of other telcos, but MTN insiders, who also requested to speak anonymously, defended the network’s decision.
“We did a commission optimization which saw the banks commission reducing from an average of 3.5% to 2.5%. This reduction is standard because the volumes compensate for the reduction,” MTN source said.
“We reviewed our commissions downwards. Most of the banks are not connected to us directly but through a third party – our convenience channel partners and aggregators.
“Communication was shared with the partners who in turn wrote to the banks (the banks here are agents to the partner). Our contract with the partners allows us to do this;
“The channels were blocked yesterday midnight leaving our customers stranded. Interesting that the bank MDs met and quickly took a decision. This references our conversation around NCC standing in the gap for the industry. Subscribers to telecommunications are being denied services by the banks even when they have money in their accounts;
“Zenith Bank is connected directly to MTN – their earnings is at 2.70%. They are happy and have not blocked us;
“Banks on ‘MTN On Demand’ had an uplift in their commission from 2.0% to 2.75% yet have blocked services;
“Banks with direct connection to us through ‘MTN On Demand’ got a commission uplift.” The source explained.
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