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The independent telecommunications infrastructure company Helios Towers has signed an agreement with Free Senegal to acquire its passive infrastructure assets for an upfront cash consideration of US$189mn (€160mn)

This represents an enterprise value of US$210mn including an estimated US$21mn of taxes and capitalised ground leases.

Free Senegal is Senegal’s second-largest mobile operator backed by an investor consortium including NJJ, founder of Iliad S.A. Private holding company Xavier Niel Group, Teyliom Group and Axian Group.

Deferred consideration and growth capex of US$47mn and US$35mn respectively are expected to be invested over the next five years in relation to the rollout of 400 committed new build-to-suit sites.

Helios Towers and Free Senegal have signed a 15-year service agreement to provide hosting and energy services on the acquired sites and future sites to be built.

The transaction is expected to close by the Q1 2021 subject to customary conditions of completion and regulatory approval. The transaction will be fully funded by existing cash and debt facilities from Helios Towers and is expected to be earnings accretive immediately.

Kash Pandya, CEO of Helios Towers, said, “This agreement is aligned perfectly with our 2025 strategic ambitions, broadening our footprint within the African towers infrastructure market.

“We are acquiring a market-leading independent position in Senegal with long-term contracted revenues and a clear path to value creation through additional organic tower development, uplifts in the tenancy ratio and improved operational effectiveness, all built on the foundation of 15-year contracts. We look forward to working with Free Senegal and the other MNOs over the coming years to further develop mobile infrastructure in Senegal.”

Mamadou Mbengue, CEO of Free Senegal, commented, “The transaction will allow Free Senegal to further expand its network mobile coverage in Senegal by partnering with the leading tower company in the region. We look forward to working closely with them in the future as a service partner of choice as we both look to further improve mobile connectivity and infrastructure for the Senegalese people and aligned with the digital plan for the Country’ Senegal 2025.”

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