IHS in Nigeria, a subsidiary of IHS Holding Limited (“IHS Towers”), one of the largest independent owners, operators, and developers of shared communications infrastructure in the world by tower count, and MTN Nigeria, a subsidiary of Africa’s largest mobile network operator MTN Group, announced an agreement to renew and extend all Nigerian tower Master Lease Agreements until December 2032, covering approximately 13,500 tenancy contracts.

With regards to the approximately 2,500 MTN Nigeria tenancies that had been due to expire at the end of 2024 and in 2025, under the new terms IHS Towers will renew 1,430 tenancies (including new colocations).

The renewed and extended contracts include new financial terms that provide what the parties believe to be a more sustainable split between local and foreign currency, as well as a new diesel-linked component.

The arrangement is testament to the criticality of IHS Towers’ infrastructure and the strong operational links between IHS Towers and MTN, Nigeria’s largest mobile network operator, with approximately 79 million subscribers.

Under the new terms, there is a USD component that will continue to benefit from annual escalators linked to US Consumer Price Index, a NGN component that will benefit from escalators linked to Nigerian Consumer Price Index, and a new component indexed to the cost of providing diesel power, introduced to act as a hedge against diesel prices and FX fluctuations.

This marks a significant milestone for IHS Towers as it has now completed the renewal of all tower MLA’s in Nigeria, a testament to the deepened relationship between the two companies.

Sam Darwish, Chairman & CEO, IHS Towers, said, “We are delighted to announce the renewal and extension of our agreement with our largest customer, MTN Nigeria. This marks a significant milestone for IHS Towers as it has completed the renewal of all tower MLA’s in Nigeria, a testament to the deepened relationship between the two companies.

“We are cognizant of the challenges faced in emerging markets and are proud to extend our relationship into the next decade, working together to navigate global and local macro conditions while broadening mobile connectivity in Nigeria through our critical infrastructure.”

FTSE-listed Network International, a trusted payment partner of Nigerian banks, has underscored its commitment to local and regional markets by bringing its innovative award-winning digital payment platform, Network One, on soil in Nigeria.

L-R: Dr. Reda Helal Group, Managing Director, Processing, Africa, Network International; Mrs. Chinwe Uzoho, Regional Managing Director, West and Central Africa, Network International; Mr. Nandan Mer, Group Chief Executive Officer, Network International and Mrs. Lola Agbebiyi, Managing Director, Nigeria, Network International during the media roundtable to announce the launch of Network One Payment Platform in Nigeria on Wednesday, August 7th 2024.

The platform is now ready to onboard and empower banks, MNOs and fintechs in Nigeria and throughout the West African region.

By deploying its flagship Network One platform on soil, Network International aligns with the Central Bank of Nigeria’s directive for in-country transaction routing, enhancing its local processing capabilities.

The integrated platform provides banks, FIs, and fintechs with a comprehensive range of payment products and services locally in Nigeria for both issuers and acquirers.

The suite is complemented by a variety of value-added services such as digital, loyalty, tokenization, enterprise fraud prevention, embedded finance and data and advisory solutions and many more.

Network International is strategically investing in rolling out the platform in key markets to effectively serve its local and regional clients and partners across the MEA region.

Nandan Mer, Group CEO, Network International, said: “This major milestone took us only a few months to deploy thanks to a local team that worked tirelessly and seamlessly with cross-functional colleagues in various geographies to ensure we deliver on Network One’s promise of innovation, resilience, and agility.

“Taking Network One live in Nigeria is integral to our company’s continued commitment to the country and the continent.”

As the fourth-largest GDP in Africa with strong consumer spending, Nigeria is ripe for a digital payments boom. Total transaction value in the domestic digital payments market is projected to reach US$21.32bn in 2024, with an annual growth rate (CAGR 2024-2028) of 10.06% projected to reach a total amount of US$31.28bn by 2028

Domestic deployment good for local and African clients

The Network One platform is an integrated payment suite offering both merchant and issuer solutions, hosted and supported in-country. It relies on a consolidation of best-in-class technologies brought together to provide end-to-end payment processing capabilities in a highly adaptable environment.

Network International is strategically positioning its proprietary technology infrastructure, which is developed, hosted, and maintained on a local level, to cater to the needs of local and regional entities seeking market-relevant digital payment solutions for their consumers.

“Our presence on the ground and comprehension of the specific needs of the local market have enabled us to tailor a solution that is ideally suited for Nigerian enterprises.

“Our capability to establish a hub equipped with all the essential technology not only empowers our clients to enhance their value proposition but also positions Network to effectively contribute to financial inclusion and democratization of payments, addressing the needs of a large population of consumers across the continent,” explained Dr. Reda Helal Group, MD – Processing, Africa and Co-Head Group Processing, Network International

Swift growth of local talent yields significant outcomes

A crucial aspect of Network International’s sustained investment in Nigeria is nurturing an empowered local workforce. By growing local personnel, Network is positioned to collaborate and co-innovate with local banks and mobile network operators, providing proximity to small and medium-sized enterprises and payment experts, right in the heart of their operations.

As a show of its commitment to the transformation of the local entity, the company is firming up its staff complement and will continue to enhance its resources and talents. Network recently marked its move from level 4 BBBEE status (in July 2023) to level 1 a year later as it continues to gain trust among African institutions as a payments partner of choice.

“By recruiting the right talent, we are assured that our teams in Nigeria can achieve quicker results with reduced reliance on our international teams, leading to significant operational benefits for our clients locally and regionally,” Dr. Helal added.

Network International’s investments throughout Africa have led to substantial improvements in economies of scale. Consequently, the company can provide state-of-the-art technology at a lower cost than what companies might incur if developed internally. This affordability, coupled with the technology’s advanced features, appeals to a broad audience and furthers the company’s mission to expedite digital transformation across the continent.

“Network One’s successful touchdown in Nigeria embodies our ambition to establish ourselves as a company that is authentically local in the African markets we serve,” Mer concluded.

MTN Nigeria has renegotiated its existing infrastructure sharing and master lease agreements with IHS Tower Nigeria Limited and ATC Nigeria Wireless Infrastructure Solutions Limited (ATC) .

The Telecom firm stated this on Wednesday through a notification letter sent by Uto Ukpanah, its Company Secretary to the Nigerian Exchange Limited and the investing public noted that the Company and IHS have successfully renegotiated binding commercial terms of the existing infrastructure sharing and master lease agreements.

This according to the company was one of the initiatives outlined at the EGM to support the recovery of our capital position.

The notification further stated that “the terms of the amendments are effective from 1 April 2024, and the existing contracts have been extended to 31 December 2032.

“Prior to the renegotiation, the site leases expired variously between December 2024 and December 2029, with the majority expiring in 2029.

“The revised terms substantially reduce the US dollar-indexed component of the leases linked to a discounted US consumer price index (CPI), making the leases majority naira-based, as well as set a cap for the naira CPI escalator component.

“They also remove technology-based pricing, allowing payments for new upgrades based on tower space and power.

“The renegotiated agreements incorporate an energy cost component indexed to the cost of providing diesel power; however, the terms also provide for some discounts and incentives over the life of the contracts.

“ The renegotiated terms aim to mitigate macro risks affecting our business as well as support margin recovery and the resolution of our negative equity position.

“In addition, MTN Nigeria, ATC Nigeria Wireless Infrastructure Solutions Limited (ATC) and IHS (the Parties) have reached a mutual agreement regarding the approximately 2,500 sites that were awarded to ATC from the IHS portfolio, per our announcement on 7 September 2023.

“Following trilateral discussions commenced in Q2 2024, the parties have agreed to a revised allocation of sites in terms of which ATC will provide tower services for up to approximately 2,100 sites; while IHS will manage up to approximately 1,400 sites.

“This includes 1,000 new MTN Nigeria sites to be rolled out over the next few years and allocated between the two tower operators”.

Commenting on the agreements, Karl Toriola, CEO of MTN Nigeria said: “We are pleased with the successful renegotiation of our tower lease agreements with IHS and ATC, which reflect a collaborative and mutually beneficial outcome aligned with the long-term interests of all parties involved.

“We anticipate that these amendments will unlock significant network cost efficiencies in line with our expense efficiency programme to improve our operating margins and capital position over the medium term.”