Wendel
21.4
(1) as of June 30, 2019.
IHS is the leading provider of telecom infrastructure in the EMEA region
IHS is one of the largest independent owners, managers and operators of telecommunications towers in the world. It is also a leader in the EMEA zone in numbers of towers. The Group builds, leases and manages telecommunications towers that it owns or that are owned by others. With approximately 24,000 towers, IHS supports the leading mobile phone operators in each of its markets and is well-placed for future organic growth given the strong demand for infrastructure needs across Africa and the Middle East.
Key figures
2018 Sales
$1,168.1m
Present in
5 countries
Amount invested by Wendel
$826m since 2013 (2)
Number of towers in portfolio
24,019 (3)
Employees
c. 2,000
No.1 in EMEA
Wendel's role in corporate governance
3 Board members
(2) Amount of equity invested by Wendel as of June 30, 2019.
(3) Tower count excluding managed services WIP as of September 30, 2019.
Why did we invest in IHS?
IHS is a leading provider of passive telecom tower infrastructure for mobile phone operators. Over the last 15 years, the Group has successfully developed along the entire telecom tower value chain, from construction to leasing to maintenance. It provides market-leading service to its customers, who are among the leading telecom operators such as MTN, Orange, 9mobile and Airtel.
With its investment in IHS, Wendel made its first direct investment in Africa, thereby demonstrating its intention to gain exposure to the rapid growth the continent is experiencing and to participate therein. Wendel has chosen a company whose positive momentum is expressed in its projects, its high-quality management and its outlook for balanced and profitable growth in several important and promising African nations., especially in Nigeria which represents about 70% of Group revenue.
Key milestones of the investment
-
10.29.2012
Wendel signs its first direct investment in Africa and selects the telecommunication infrastructure sector -
05.14.2013
Wendel is now IHS’ largest shareholder with $176m invested -
07.24.2013
Wendel increases it investment in IHS to $276m -
03.03.2014
Wendel supports IHS in a new capital increase, boosting its total investment to $428m -
04.16.2014
Wendel increases its total investment in IHS to $475m -
11.03.2014
Wendel has committed an additional $304m in IHS, which will bring its total investment to $779m -
12.15.2014
Wendel has invested $195m out of the $304m committed by the Group in IHS -
07.08.2015
Wendel invests $109m and completes its latest investment in IHS bringing its total investment to $779m -
09.08.2016
Wendel invests an additional $46m in IHS to finance its growth and development -
02.01.2017
Simplification of IHS’s capital structure
- Wendel signs its first direct investment in Africa and selects the telecommunication infrastructure sector - 129.73 KB - PDF
- Wendel is now IHS’ largest shareholder with $176m invested - 342.5 KB - PDF
- Wendel increases it investment in IHS to $276m - 289.95 KB - PDF
- Wendel supports IHS in a new capital increase, boosting its total investment to $428m - 196.8 KB - PDF
- Wendel increases its total investment in IHS to $475m - 249.31 KB - PDF
- Wendel has committed an additional $304m in IHS, which will bring its total investment to $779m - 145.28 KB - PDF
- Wendel has invested $195m out of the $304m committed by the Group in IHS - 174.26 KB - PDF
- Wendel invests $109m and completes its latest investment in IHS bringing its total investment to $779m - 167.44 KB - PDF
- Wendel invests an additional $46m in IHS to finance its growth and development - 603.46 KB - PDF
- Simplification of IHS’s capital structure - 273.59 KB - PDF
Read the press release
IHS’s business is being buoyed by long-term trends that make Africa a strong growth region for telecom infrastructure:
- growth potential is higher than in mature economies, both in terms of GDP and demographics. In Sub-Saharan Africa, GDP has grown by 6% p.a. on average over the last ten years and the continent’s population is young, with a growing middle class;
- the telecom market in Africa is expanding steadily, driven by a continuous rise in the number of subscribers, expected to increase by more than 4% p.a. between now and 2022, and by an increase in the smartphone penetration rate, which at 40% is one of the lowest in the world;
- telecom operators need to extend their network coverage on a continent whose population density is low. This situation favors the sharing model for telecom towers. The need for new towers in Africa is estimated at around 170,000 units over the next few years, which would bring the total to 350,000;
- regulations are encouraging sharing of tower space so as to rapidly increase the coverage of telecom networks;
- new mobile internet services (3G and 4G deployment) are constantly being rolled out. Fixed-line telephone service, available to only 14% of the population, is low and not expected to change materially.
$826 million invested by Wendel
To support IHS’s pan-African growth strategy, Wendel invested $826 million between 2013 and 2016, by participating in five capital increases alongside IHS’s shareholders, who are primarily major financial institutions active in economic development and top-tier private equity companies.
Among these are Emerging Capital Partners, the leader in private equity in Africa with more than 60 investments since 1997, International Finance Corporation (IFC), part of the World Bank Group, FMO, the Netherlands development bank, and Investec Asset Management, one of the largest investors in listed and unlisted companies in Africa. In 2014, new investors chose to support the growth of IHS, in particular Goldman Sachs, IFC Global Infrastructure Fund, African Infrastructure Investment Managers (Old Mutual and previously Macquarie), and the Singapore and Korean sovereign wealth funds GIC and KIC.
In addition, Wendel has brought together five US and European family investors (incl. FFP, Sofina, ERES and Luxempart) to invest alongside it in IHS. In addition to the $826 million it has invested, Wendel has thus far raised an additional $220 million through an IHS co-investment vehicle that Wendel manages and whose voting rights Wendel exercises.
On February 1st, 2017, MTN Group (“MTN”) finalized the exchange of its 51% stake in Nigeria Tower InterCo B.V, the operating holding company of INT Towers Limited, which manages more than 9,000 towers in Nigeria, for an additional direct stake in IHS Group. As a result of this transaction MTN’s economic interest in IHS Group increased from around 15% to around 29%. To preserve IHS’ independence, MTN’s voting rights, representation and access to information on IHS will remain limited. Following this simplification of IHS’ capital structure, Wendel holds 21.3% of the shares of IHS directly and remains IHS’ largest shareholder in voting rights with unchanged governance rights.
IHS pursues its development
With regards to external growth, the acquisition of c. 1,600 towers from Zain in Kuwait is still pending regulatory authorizations that should come in the coming months. Moreover, on March 27, 2019 IHS entered into an agreement with Zain for a leaseback contract covering 8,100 towers in Saudi Arabia with a 15-year lease agreement. This operation is subject to the customary regulatory approvals and finalization conditions. This operation is in line with the Company's growth strategy in the Middle East.
“Wendel is a long-term investor and therefore the ideal partner to support our high-growth, pan-African strategy. Wendel's expertise, network and strong reputation are all advantages for IHS's future.”
Top management
Sam Darwish
Founder, Executive Vice Chairman
and Group CEO
Wendel's role in corporate governance
Board of Directors of IHS Holding
David Darmon
Stéphane Heuzé
3 minutes to understand IHS
