MTN seeks local investors for $1.1bn IHS Nigeria stake to meet deal condition

MTN Group is seeking Nigerian investors to buy a 30 percent stake in IHS Nigeria, a move that could raise between $900 million and $1.1 billion and satisfy a key condition attached to its proposed takeover of IHS Towers.

People familiar with the matter said that MTN is looking for local investors for the stake, which must be sold at market-based prices. MTN has not disclosed the names of potential investors or the structure of the proposed sale.

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The sell-down is not a voluntary disposal. It is a condition imposed by Nigeria’s Federal Competition and Consumer Protection Commission (FCCPC) as part of its conditional approval of MTN’s planned $6.2 billion acquisition of IHS Towers. Under the agreement, MTN must sell up to 30 percent of the Nigerian component of IHS to local investors on an arm’s-length commercial basis and subject to market conditions.

The size of the proposed stake gives the transaction a potentially significant role in Nigeria’s capital market. A sale of as much as $1.1 billion would create one of the larger opportunities in recent years for Nigerian institutions to take direct ownership of critical telecommunications infrastructure.

For MTN, however, the immediate attraction is also financial. Ralph Mupita, chief executive officer said proceeds from the sell-down would be used to reduce debt associated with IHS. MTN has already arranged about $1.1 billion in additional funding needed to complete the wider acquisition, meaning proceeds from the Nigerian stake sale could help lower the debt burden attached to the transaction.

The requirement also changes the economics of MTN’s IHS strategy. The telecom group wants to regain control of infrastructure that supports its network, but Nigeria’s competition authorities are preventing it from taking unrestricted ownership of the local tower business.

IHS Nigeria is particularly important because of the scale of its infrastructure. The business operates about 18,000 towers in Nigeria, making it the largest component of IHS Towers’ African operations. Those towers are used not only by MTN but also by other telecommunications operators, making ownership of the infrastructure strategically sensitive.

That is why the local ownership requirement goes beyond simply raising money. It is designed to ensure that a critical part of Nigeria’s digital infrastructure does not become entirely controlled by one of the country’s largest mobile operators.

The FCCPC condition is complemented by separate safeguards from the Nigerian Communications Commission. The NCC has granted MTN an Approval-in-Principle for the acquisition, but final clearance remains subject to conditions covering corporate governance, existing contracts, market access and future investment.

The NCC has specifically required that the transaction must not give MTN exclusive rights over IHS infrastructure and that existing contracts must not be changed because of the acquisition. MTN must also submit an investment plan with measurable milestones. These safeguards are intended to protect rival operators that depend on IHS towers while ensuring the infrastructure continues to receive investment.

The regulatory structure means MTN is effectively being allowed to take control of IHS while being required to share ownership and preserve open access to the infrastructure.

The broader acquisition values IHS Towers at about $6.2 billion and would give MTN the remaining 75 percent of IHS that it does not already own. IHS shareholders approved the transaction in August, while regulatory approvals remain a key step before completion. MTN expects the deal to close in the second half of 2026.

For Nigerian investors, the opportunity comes as demand for telecom infrastructure continues to rise. Nigeria’s expanding smartphone use, data consumption and 4G and 5G deployment are increasing the importance of towers and other passive infrastructure.

For MTN, the bigger prize is control. The acquisition would bring a major part of the physical infrastructure supporting its Nigerian network back into the group’s ownership after years of relying on independent tower companies.

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But the 30 percent sell-down ensures that control will not be absolute. Instead, MTN will have to balance its strategic interest in owning the infrastructure with the regulator’s demand for Nigerian participation, competition and continued access for rival operators.

The outcome could therefore create a new model for ownership of telecom infrastructure in Nigeria: MTN gets greater control of the towers, while local investors gain a sizeable stake in an asset central to the country’s digital economy.