U.S. businessman Jeffrey Stoops’ SBA Communications acquires Airtel Africa tower assets in Tanzania

SBA Communications, a U.S.-based wireless communications infrastructure operator, has finalized the acquisition of Airtel Africa’s telecom tower assets in Tanzania in a deal valued at $176.1 million.

A press release issued by Airtel Africa from its London office stated that the deal was completed by a joint venture company owned by a wholly-owned SBA Communications subsidiary and Paradigm Infrastructure Limited, a UK company managing wireless infrastructure in growth markets.

U.S. investor Jeffrey Stoops, who is the current CEO and chairman of SBA Communications, holds a direct 0.77-percent stake in the U.S.-based wireless asset operator. His stake in the company is valued at $309.9 million.

The sale of the tower assets is a strategic divestment of Airtel’s tower portfolio, as the company moves to reduce its assets base and focus on core subscriber operations such as voice and data services.

According to the terms, Airtel will develop, maintain and operate its equipment on the towers under a lease arrangement with the new owners made in the local currency.

The acquisition of the tower portfolio at a gross consideration of $176.1 million will help boost SBA’s infrastructure on the African continent. This will enable the company to meet the mobile demand in Tanzania and facilitate entry into other African markets.

In line with the agreements, about $159 million of the proceeds have been paid, with the balance payable in installments upon the completion of the transfer of the towers to SBA Communications.

Airtel Africa noted that about $60 million of the proceeds will be used to invest in network and sales infrastructure in Tanzania and for distribution to the Tanzanian government, according to the settlement described in Airtel Africa’s IPO prospectus document published in June 2019.

The balance of the proceeds will be deployed to reduce the group’s debt in line with its strategic move to reduce its operating costs.

As of press time, Jan. 5, shares in SBA Communications were trading at $369.46, 2.74-percent lower than their opening price on NASDAQ. Meanwhile, shares in Airtel Africa closed 10-percent higher at N1,050.5 ($2.555) on the Nigerian Exchange.