IFC backs Helios Towers

Published: February 28, 2011

Sub-Saharan phone coverage to increase.

Mobile phone coverage across Sub-Saharan Africa is set to increase while costs fall following an investment by the International Finance Corporation (IFC), an arm of the World Bank that promotes private sector investment in developing nations.

Mobile phone towers are to be built in several countries across the continent after the IFC injected US$25mn into Helios Towers Africa.

Helios is building a pan-Africa tower company starting in Ghana and expanding into other countries such as Tanzania. The company will help increase mobile phone and other communication technology coverage across Africa by leasing space on its towers to telecom companies.

Bernard Sheahan, IFC director of infrastructure and natural resources in Africa, Latin America and the Caribbean, said that broadening access to affordable mobile telecoms is a crucial part of Africa’s development.

“With this investment, IFC is further lowering the barriers to accessing the knowledge, innovation and improved government and business services that mobile communications can bring,” he added.

The cost reductions that Helios provides will give smaller companies access to existing tower networks while allowing larger operators to expand into remote areas that would not normally have been profitable. Lower tower costs should result in enhanced service offerings and declining mobile prices for African consumers.

Helios was established by Helios Investment Partners in 2009 to replicate the success achieved by its Helios Towers Nigeria business, which four years earlier became the first independent mobile communications tower company in Africa.

In 2010, it formed Helios Towers Ghana to buy and lease back some 750 towers in Ghana to mobile operator Millicom, the first such transaction in Africa. The company recently announced that it intends to buy more than 1,000 further sites in Tanzania from Millicom.

This latest investment follows IFC’s support for Helios Towers Nigeria two years ago, where it made available US$250mn in syndicated loans, mezzanine financing and senior debt, allowing the company to build, maintain and lease space on its network of telecom towers in Nigeria.