Mohamad Darwish of IHS Towers recently spoke to Comm. about the opportunities and challenges resulting from the company’s successes across the African continent. Darwish is Group Executive Committee Member and a founding partner of the company. IHS is the largest independent mobile telecommunications provider in Africa, Europe and the Middle East and in September 2014 acquired 9,151 sites from MTN Nigeria. Mohamad Darwish estimates that the deal with MTN Nigeria alone will result in the number of IHS employees in the country rising from 600 to at least 1,000 given the scope of the work required. He believes that the intrinsic benefits that independent tower companies such as IHS bring to bear continue to centre on the creation of efficiencies, sharing of resources, and ultimately the reduction of costs. The business structure of tower companies, explained Mohamad Darwish, is to acquire the passive infrastructure and real estate sites of network operators that they then lease back, and which companies such as IHS then go on to make money from by offering co-located services to multiple service providers. It is a concept that appears to be garnering significant support from the investor community with IHS having been able to raise US$1.6 billion in 2014 alone. "IHS has a long history of working with network operators, spanning 15 years," Darwish explains. "We didn't only come about with co-location solutions, but we have long technical experience and expertise in telecom." Mohamad Darwish commented that a view to replicate its success in Africa and other emerging markets in other parts of the world is reflected in a recent tie-up with Indian operator Bharti Airtel. This may be a stepping stone to South Asia and beyond for IHS. With that agreement came an additional 1,100 towers in Zambia and Rwanda acquired through sale and lease back agreements under a 10-year renewable contract with Bharti Airtel, resulting in the expansion of the IHS' Africa tower footprint to over 23,000 towers across five countries.

1. Last Updated:10 May 15
Conquering Africa
By Tawanda Chihota
IHS has been one of the leading independent tower companies in Africa, and the September 2014 move of over 9,000 sites from MTN Nigeria to a
company jointly held by IHS and MTN took the company to a whole new level of operation. Mohamad Darwish, IHS Group Executive Committee
Member and founding partner, has a hands-on roll in Nigeria as IHS' deputy CEO there, and talks to Comm. about the opportunities and
challenges resulting from the company's successes across the continent.
Mohamad Darwish estimates that the deal with MTN Nigeria alone will result in IHS' staff compliment in the country rising from 600 to at least 1,000 given the
scope of the work required. He believes the intrinsic benefits that independent tower companies such as IHS bring to bear continue to centre on the creation of
efficiencies, sharing of resources, and ultimately the reduction of costs.
"We are actively driving down costs, and as a neutral partner to network operators, can be considered as a solid technical partner," Darwish says. "In IHS' case in
particular, we find that the companies we work with are comfortable with our abilities as a partner, and see us as a way to reduce cost, and raise some cash."
The model for tower companies, at its most basic, is the offer of cash now for the passive infrastructure and real estate sites of network operators that they then
lease back, and which companies such as IHS then go on to make money from by offering co-located services to multiple service providers. It is a concept that
appears to be garnering significant support from the investor community with IHS having been able to raise US$1.6 billion in the year to April 2014 alone.
Darwish, who is the brother of IHS Group CEO, Issam Darwish, says the company's two main offerings encompass the reduction of costs to network operators
while allowing them to raise cash from selling their base of towers; as well as offering a better quality of service measured by the 99.9 per cent network availability
in up-time.
"IHS has a long history of working with network operators, spanning 15 years," Darwish explains. "We didn't only come about with co-location solutions, but we
have long technical experience and expertise in telecom."
Indeed, IHS' perceived expertise is being converted into significant momentum by the company which last November announced that it had signed agreements for
a capital raise of US$2.6 billion, comprising equity of US$2 billion and a loan facility of US$600 million. At the time the company said the deal represented the
largest equity raise in Africa since 2007 and served to underline its position as the largest tower company in Europe, Middle East, and Africa.
That latest tranche of fundraising lifted IHS' total amount raised to US$4.5 billion since 2012, with the company stating it has deployed the funds in establishing
market-leading positions across Africa in Nigeria, Cameroon, the Ivory Coast, Zambia, and Rwanda.
The round of funding announced in November is set to be applied to acquisitions that have more than doubled the size of the company's tower portfolio in the 12
months to that point, as well as further new site build programmes across the IHS footprint.
The funds are also earmarked for the continued roll out of innovative, efficient power technologies and operational management solutions including solar systems
and high efficiency generator units, which are set to deliver greener and more efficient power systems to IHS' tower portfolio.
"In parts of Africa around half of operators' opex is spent of powering base stations with diesel. We are serious about exploring and implementing alternative
power solutions, and in Nigeria alone 3,000 sites are already powered by new power systems," Darwish says.
With a view to replicating its success in Africa in other emerging markets in other parts of the world, a recent tie-up with India operator Bharti Airtel may be a
stepping stone to South Asia and beyond for IHS, though the agreement it announced with the India telco in December 2014 is still very firmly based on the
continent of Africa. With that agreement came an additional 1,100 towers in Zambia and Rwanda moved over to IHS through a sale and lease back arrangement
under a 10-year renewable contract with Bharti Airtel, resulting in the expansion of the IHS' Africa tower footprint to over 21,000 towers across five countries.
"We are following the growth and development of the mobile operators and are extremely optimistic about the future. In Nigeria specifically, which is something of
a high level reference market for us, we are ready for the implementation of 3.9G," Darwish concludes. "There is plenty of work that is required, as it's a complex
business we are running, with there being three and sometimes even four tenants sharing tower sites. We are also busy rolling out into new geographic areas and
ensuring the integration of new sites, and new power solutions."
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