Independent telecom infrastructure company Helios Towers has signed agreements with Airtel Africa to acquire its passive infrastructure operating companies in Madagascar and Malawi, and has entered into exclusive MoU for the potential acquisition of its passive infrastructure assets in Chad and Gabon.

A statement released to the media explains that the transactions comprise four separate agreements, all of which are subject to required regulatory approvals.

“Two separate agreements, one for each market, for the acquisition of Airtel Africa’s passive infrastructure companies in Madagascar and Malawi for a total expected consideration of $108 million. These acquisitions are both anticipated to close in or around Q4 2021, subject to separate customary closing conditions including required regulatory approvals,” reads part of the statement.

“In each of Chad and Gabon, the Group has entered into exclusive memorandum of understanding arrangements and, subject to obtaining a passive infrastructure licence in each jurisdiction, is expected to complete the acquisition of Airtel Africa’s passive infrastructure assets in those countries in or around Q1 2022,” it continues.

The telecommunications companies add that the transactions assets are expected to generate aggregated annualised revenues of US$89-million and Adjusted EBITDA of US$27-million (in the first full year of ownership), with further growth anticipated through 315 committed build to suits (“BTS”) and colocation lease-up.

They also state that the transactions – expected to be financed through Helios Towers’ existing cash and debt facilities - represent 2,227 existing sites across Madagascar, Malawi, Chad and Gabon.

“Together with the committed BTS and acquisition of assets in Senegal announced on 12 August 2020 – which is expected to close in H1 2021 – increases Group site count to c.11,500 towers, nearing the Group’s 2025 vision of expanding to 12,000+ towers. Long-term service contracts for an initial period of 12 years provide $1.1 billion of future contracted revenue, which together with the previously announced 15 year service agreement with Free Senegal, increases Group contracted revenue to c.$4.6 billion and extends average remaining life to 8 years,” according to the statement.

It adds: “Strong hard currency Adjusted EBITDA mix at 85% for the portfolio, reflecting EUR-pegged currencies in Chad and Gabon and USD-linked revenues in Madagascar and Malawi, which further strengthens Group Adjusted EBITDA in hard currency to c.70%.”

Commenting on the Transactions, Kash Pandya, Chief Executive Officer of Helios Towers, said: " "We are delighted to announce these acquisitions which, alongside the previously announced entry into Senegal, means we will deliver on our 2025 ambition to increase our operational presence to at least eight markets well ahead of schedule and represents a significant step towards our target of 12,000+ sites. Additionally, as a result of service contract structuring and market selection, our hard-currency revenues and adjusted EBITDA will improve further, providing enhanced future stability for the business and complimented by the 12-year service contracts with Airtel Africa. We look forward to strengthening our relationship with Airtel Africa and the other MNOs by delivering exceptional services levels in these markets over the coming years, driving the sustainable growth of communications across Africa.”