Tigo sells 750 towers to Helios Towers Ghana

Millicom Internaltional Cellular S. A. has announced that its Ghana subsidiary Millicom Ghana, operators of Tigo mobile phone services has agreed to sell approximately 750 towers to Helios Towers Ghana (HTG), a direct subsidiary of Helios Towers Africa.

As a result of the deal, Tigo will retain a minority interest in HTG, the company has said in a press statement.

The statement also indicated that Tigo Ghana and HTG have entered into a long term leasing agreement where HTG will provide Tigo Ghana with wireless communications towers, including a build-to-suit agreement to support the company’s wireless networks.

HTG, according to the statement will seek similar agreements with other operators in Ghana. The transaction is expected to create savings in both capital and operating expenditure for Tigo Ghana.

Commenting, Mikael Grahne, President and CEO of Millicom, said: “This agreement marks our first substantial commitment to outsourcing passive infrastructure, and is entirely consistent with our strategy of improving both our capital and operating efficiency by focusing on our core activities. Operators around the world are increasingly recognising that owning and operating all of their own network infrastructure does not confer a competitive advantage. The new venture will allow Tigo Ghana to focus on areas of genuine differentiation: sales, marketing, distribution, service innovation and customer care.”

“HTG enables Ghanaian wireless operators to outsource non-core tower-related activities and focus their capital and managerial resources on providing higher quality services more cost-effectively. We are very excited about our agreement with Tigo Ghana as it will provide HTG with scale and coverage of virtually all of Ghana’s significant population centers,” said Tope Lawani, Managing Partner of Helios Investment Partners.

He added, “This transaction will ensure that HTG has, as an anchor tenant on each of its towers, a high quality operator with a demonstrated long-term commitment to the development of wireless services in Ghana.”

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 in approximately 90 days, it said.

Millicom is the first mobile phone company to be licensed in Ghana in 1991. It started operations in 1992 and operated the brand name Mobitel.

In 1996, the brand owners, Millicom International Cellular (MIC) changed the brand name in Ghana to Tigo, in line with its strategy of having a single brand name for all its global operations.

In August 2009, the Chairman of Millicom Ghana Ltd., said the company had invested half a billion dollars into the Ghanaian economy, and spent $680,000 on training and development.

Tigo is one of the six mobile phone companies operating in the country. The others are MTN, Kasapa, Zain, Vodafone and Glo, which is yet to start operations.

By Emmanuel K. Dogbevi