Bharti Airtel announced on Monday that it has entered into an agreement with American Tower Corporation (ATC) to sell around 1,350 of its communications towers in Tanzania.
The agreement was signed by its subsidiary company, Airtel Tanzania.
"Under the agreement, American Tower may acquire up to approximately 100 additional sites currently in development for an additional consideration. Airtel will be the anchor tenant on the portfolio under a lease with a ten-year initial term," said a company statement.
"The proposed transaction is a continuation of our stated philosophy of divesting passive infrastructure assets and promoting sharing of towers to enhance operational efficiencies that will further the overall growth of telecom services. Airtel remains committed to Tanzania and will continue to invest in its operations and serve customers with world-class services," said Bharti Airtel's MD & CEO, Africa, Christian de Faria.
The statement said the transaction is expected to close during the first half of 2016, subject to customary closing conditions and regulatory approval.
"With a young, growing population, tremendous growth potential and a complementary location relative to our existing African operations, we view Tanzania as a highly attractive adjacent market opportunity," said American Tower's executive vice president and president, Europe, Middle East and Africa, Hal Hess.
The tower sale agreements allow Airtel to focus on its core business and customers, besides helping deleverage through debt reduction, and significantly reducing the on-going capital expenditure on passive infrastructure.