Wendel
21.3
(1) as of June 30, 2020.
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 28,000 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, the Middle East and Latin America.
Key figures
2019 Sales
$1,231.1m
Present in
9 countries
Amount invested by Wendel
$830m since 2013 (2)
Number of towers in portfolio
27,975 (3)
Employees
c. 2,000
No.1 in Africa
Wendel's role in corporate governance
2 Board members
(2) Amount of equity invested by Wendel as of June 30, 2020.
(3) Tower count excluding managed services and WIP pro forma of Kuwait and CSS acquisitions (closed in 2020).
Why did we invest in IHS?
IHS is a leading provider of passive telecom tower infrastructure for mobile phone operators. Over the last 19 years, the Group has successfully developed along the entire telecom tower value chain, from construction to leasing via maintenance. It provides market-leading service to its customers, who are among the leading telecom operators such as Airtel, MTN, Orange, and 9mobile.
With its investment in IHS, Wendel made its first direct investment in Africa, thereby demonstrating its intention, at this time, 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 75% 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 5% p.a. on average over the last fifteen 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 5% p.a. between 2018 and 2025, and by an increase in the smartphone penetration rate, which at 40% at the end of 2018 is one of the lowest in the world; and is expected to raise to 66% in 2025;
- 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. In 2018, there were about 240 million mobile Internet users in Africa. This figure is expected to double by 2025.
$830 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. In 2019, Wendel exercised warrants in IHS that were issued in 2012 for a net value of $4 million.
Among the shareholders are Emerging Capital Partners, a 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 $830 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 1, 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 Holding Limited (“IHS”). 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 share capital of IHS directly and remains IHS’ largest shareholder in voting rights with unchanged governance rights as a minority shareholder.
* Amount of equity invested by Wendel as of December 31, 2019, for the stake held at that date. Effective ownership of 19.2% dilutive effect of profit-sharing mechanism.
“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.”
Sustainable development and extra-financial information
The purpose of IHS Towers is to have a positive impact on communities in the countries where it operates, helping to improve the quality and availability of telecom infrastructure in an increasingly connected world. Its investments in telecoms towers help to connect individuals, businesses and governments. With increased connectivity of individuals, opportunities for expansion are increasing. The impact of IHS Towers goes beyond the benefits of connectivity, in particular through the four pillars of its sustainable development strategy: Education and Economic Growth, Ethics and Governance, Employees and Communities and Environment and Climate Change.
Top management
Sam Darwish
Founder, Executive Vice Chairman
and Group CEO
Wendel's role in corporate governance
Board of Directors
David Darmon
Frank Dangeard
Audit Committee
Frank Dangeard
Compensation Committee
David Darmon
Appointments Committee
David Darmon