American Tower Corporation (ATC) has reached an agreement to acquire 723 telecommunication towers held by Telkom Kenya for an undisclosed amount.
The deal, which is expected to be completed in the first half of 2018, will give the multinational a presence in the country, nearly a decade after making its maiden foray into East Africa through similar acquisitions in neighbouring Uganda and Tanzania.
“On April 3, 2018, the company, (American Tower Corp) through its recently formed Kenyan subsidiary, (AT Kenya C.V) entered into a definitive agreement with Telkom Kenya Limited to acquire up to 723 communications sites,” said the firm in regulatory filings.
“The transaction is expected to close during the second half of 2018, subject to customary closing conditions, including the satisfaction of regulatory approvals,” it added.
Telkom Kenya had not provided the Business Daily with additional details of the transaction by the time of going to Press. The deal is expected to enable third-placed Telkom Kenya, which is said to be negotiating a joint operation plan with Airtel Kenya, to use the proceeds to strengthen its balance sheet.
Telkom Kenya said earlier that its five-year strategy is to invest Sh15.2 billion ($150 million) in its 3G and 4G networks as well as mobile financial services and customer experience.
Private equity firm Helios bought into Telkom Kenya in 2016, saying it intended to rescue the ailing company through heavy investments and an overhaul of management.
Telkom Kenya said it has already invested about Sh5.6 billion in expanding and modernising its network, including launching 4G services.
Telkom Kenya is also set to receive a Sh4.1 billion ($40 million) loan from the European Investment Bank to boost infrastructure and mobile money network.
The American telecommunication firm operates long-term lease arrangements with its partners. It entered into a pact with MTN Group of South Africa in 2011 to establish a joint venture tower company in Uganda.
The Boston-based firm in 2016 announced plans to pay $179 million (Sh17.9 billion) to New Delhi-based Bharti Airtel for its subsidiary Airtel Tanzania Ltd’s 1,350 towers.