Airtel Africa Plc says it plans to sell about 4,500 telecommunication towers across five countries including Tanzania and Madagascar to cut its $3.5 billion debt and prepare for upcoming bond repayments.
Africa’s second-largest carrier by subscribers is also disposing of cellular masts in Gabon, Malawi and Chad, Chief Executive Officer Raghunath Mandava said in an interview. “We are constantly seeking to bring down our debt, and we prefer to bring it down even faster with the tower deals,” he said.
Airtel has a repayment of 750 million euros ($890 million) due in May, while an installment of $505 million is due in March 2023, according to the annual report.
The company, which was spun off from India’s Bharti Airtel Ltd. last year and is listed in London and Nigeria, used the proceeds of the dual initial public offering to help cut borrowings to $3.5 billion from about $7.7 billion, the CEO said.
The outstanding balance includes $1.8 billion of bonds that have cross-default clauses with Bharti Airtel, still its biggest shareholder.
The stock has declined 18% since the June, 2019 IPO, valuing the company at 2.4 billion pounds ($3.1 billion).
A number of the continent’s wireless carriers have been selling similar tower assets to specialist operators, opting to save on maintenance costs, allay security concerns, and bypass shortfalls in power and road infrastructure. Meanwhile, the need for additional masts in Africa is increasing as millions more adopt smartphones and faster broadband is needed.
Airtel Africa plans to lease back the towers from the buyers, Mandava said.
Many of Airtel Africa’s 14 markets border each other, making it easier to roll out fiber even during the Covid-19 pandemic, the CEO said. The company has added 9,000 kilometers (5,592 miles) of cable this year, bringing the total to 47,000 kilometers.
“Our focus is to grow in the countries that we are in,” he said.
