(Bloomberg) -- American Tower Corp. agreed to buy Eaton Towers Ltd. for about $1.85 billion including debt as one of the few international providers of telecommunications infrastructure expands in the fast-growing African market.
Both companies have sites in countries such as Ghana and Kenya, and the deal will enable American Tower to build more on the continent, the Boston-based company said in a statement on Thursday. The tie-up will generate about $260 million in property revenue in the first year of ownership, it said.
While the global telecom tower market is dominated by local players, American Tower is looking to take advantage of accelerating mobile phone usage and the rollout of high-speed 4G technology in Africa. This is its second acquisition in Africa in the past year, after it agreed to buy more than 700 towers from Telkom Kenya. American Tower has about 170,000 sites in 17 countries worldwide.
Less than a year ago, Eaton scrapped plans for an initial public offering in London and Johannesburg, people familiar with the matter said at the time. The company, partly owned by Ethos Private Equity Pty Ltd. and Development Partners International, was seeking a valuation of about $2 billion to fund its own expansion plans, they said.
Eaton rivals Helios Towers Plc and IHS Towers Ltd. also scrapped IPOs last year as investors balked at the risks in some of their markets. IHS said it was worried about the uncertain outcome of Nigeria's 2019 presidential election, which took place in February. That company is part-owned by wireless carrier MTN Group Ltd., which has said it's open to a sale.
American Tower's shares rose 0.7% as of 9:45 a.m. in New York. The stock is up 28% so far this year.
To contact the reporters on this story: John Bowker in Johannesburg at jbowker2@bloomberg.net;Scott Moritz in New York at smoritz6@bloomberg.net
To contact the editors responsible for this story: Rebecca Penty at rpenty@bloomberg.net, Thomas Pfeiffer, Cécile Daurat
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