MTN Nigeria has announced plans to review its tower contracts to drive efficiency and ensure optimal performance from vendors. It has even awarded about 2.5k network sites that were initially under the IHS portfolio to ATC.
Recall that IHS currently has 14.6k sites (80 percent) as opposed to ATC’s 2.3k (13 percent). About 2.5k network sites under the IHS portfolio due to expire in 2024 and 2025 have been awarded to ATC after a highly competitive bidding process. This will reduce IHS’ portfolio to 12.1k sites (66 percent) and increase ATC to 4.7k (26 percent) of the entire portfolio. The remaining IHS sites will expire between 2025 and 2029, with the majority in 2029.
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The CEO of MTN Nigeria, Karl Toriola, who gave the insight at MTN Nigeria’s Capital Markets Day, in Abuja, affirmed that efficient tower contracts are key to driving cost-effectiveness, deep broadband penetration, and leading technology across the telcos operations.
In the company’s quest to achieve differentiated value, Toriola revealed that MTN will, from time to time, review the contracts it has with partners to ensure they optimally meet the company’s site requirements. “But beyond efficiency, we will also focus on cost optimization, green energy utilisation and sustainability,” he added.
Amongst other things, Toriola also used the CMD event opportunity to announce the progress made on achieving the company’s ‘Ambition 2025’ strategy and the emerging opportunities in Nigeria’s digital economy to local and international investors.
“I am encouraged and excited at the prospect of a liberal economic reform agenda for Nigeria that presents an opportunity to unleash its latent growth potential.
The recognition that private sector investment will be critical to that is clear, and we are already seeing steps being taken to enable the business environment. We believe that Nigeria continues to present significant opportunities for us to deliver inclusive growth and expand access to connectivity while also supporting the drive for financial inclusion,” he said.
In his own presentation, MTNN’s chief financial officer, Modupe Kadri, gave the current breakdown of the company’s tower business, saying energy efficiency initiatives and independent power projects (IPP) are essential in achieving excellent delivery of the company’s expense efficiency programme.
“It is important to say that tower contract renegotiation, supported by disciplined capital allocation, is very important in mitigating the impact of forex liberalisation and higher energy costs,” he said.
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