The CEO of MTN Nigeria, Karl Toriola, has revealed plans for periodic reviews of the company’s tower contracts to enhance efficiency and ensure optimal vendor performance. This initiative comes in light of the recent award of tower contracts to ATC, with an additional 1,500 site contracts set for renewal in the near future. The announcement was made during MTN Nigeria’s Capital Markets Day held in Abuja, as stated by a release from the company.
Toriola emphasized the importance of cost-effective strategies in driving deep broadband penetration and leading-edge technology implementation across their operations. He stated, “In our quest to achieve differentiated value, we will from time to time review the contracts we have with our partners to ensure they optimally meet our site requirements. But beyond efficiency, we will also focus on cost optimization, green energy utilization, and sustainability.”
Providing further insight into MTN’s tower business, MTNN’s Chief Financial Officer, Modupe Kadri, highlighted the significance of energy efficiency initiatives and independent power projects (IPP) for achieving excellence in the company’s expense efficiency program. Kadri noted the current breakdown of the company’s tower business, revealing that IHS currently manages 14.6k sites (80%), while ATC oversees 2.3k sites (13%). Following a competitive bidding process, ATC has been awarded 2.5k network sites under the IHS portfolio set to expire in 2024 and 2025. This will reduce IHS’ portfolio to 12.1k sites (66%) and increase ATC’s share to 4.7k sites (26%).
Kadri stressed the importance of tower contract renegotiation, supported by disciplined capital allocation, in mitigating the impact of forex liberalization and rising energy costs. He explained that the remaining IHS sites are set to expire between 2025 and 2029, with the majority expiring in 2029.
Additionally, Toriola took the opportunity at the Capital Markets Day event to update stakeholders on the progress of MTN Nigeria’s ‘Ambition 2025’ Strategy and the emerging opportunities in Nigeria’s digital economy. He expressed optimism about the liberal economic reform agenda for Nigeria, presenting an opportunity to unleash latent growth potential. Toriola noted the clear recognition that private sector investment is crucial to this agenda, and steps are being taken to enable a conducive business environment.
Speaking about the prospects in Nigeria, Toriola stated, “We believe that Nigeria continues to present significant opportunities for us to deliver inclusive growth and expand access to connectivity while also supporting the drive for financial inclusion.”
The Capital Markets Day event witnessed the participation of local and international investors who engaged with high-level representatives of the Nigerian government on the country’s macroeconomic reforms. MTN Nigeria executives provided a comprehensive overview of the company’s progress against key ‘Ambition 2025’ growth indicators. This event served as a platform for stakeholders to gain insights into the company’s strategic direction, growth plans, and its role in contributing to Nigeria’s economic development.
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