Millicom Sells Tower Assets in Democratic Republic of the Congo
Published on: 22nd Dec 2010
Note -- this news article is more than a year old.
Millicom International has sold 729 towers belonging to its subsidiary in the Democratic Republic of the Congo (Tigo DRC) to Helios Towers. As a result of the transaction, Tigo DRC will receive at least USD45 million of cash up front and will retain a significant minority interest in Helios Towers' local holding company.
Additionally, Tigo DRC and HTD have entered into a long term leasing agreement whereby HTD will provide Tigo DRC with access to wireless communications towers and a build-to-suit agreement to support the company's wireless networks. HTD will seek similar agreements with other operators in DRC. The transaction is expected to create savings in both capital and operating expenditure for Tigo DRC.
Mikael Grahne, President and CEO of Millicom, said: "This agreement with HTD in DRC is Millicom's third such deal with Helios in Africa and it brings us to a point where nearly two-thirds of our towers in Africa are committed to be outsourced. We view the DRC as a very attractive market for asset sharing considering its size, lower average purchasing power and logistical complexities. We are confident that this and similar previously announced ventures will continue to produce satisfactory results and improved service levels as we have experienced in Ghana since the creation of the first tower joint venture in Africa with Helios in January 2010. These agreements, and any future sale of our remaining towers in Africa, will enable us to improve both our capital and operating efficiency by focusing on our core activities of sales, marketing, branding, distribution, service innovation and customer care."
The specific number of towers and final purchase price will be determined at closing. First closing of the transaction, subject to customary closing conditions, is expected to take place around Q3 2011.