Helios Towers Halts IPO Plans After Eaton Towers Deal Report

LAGOS (Capital Markets in Africa) – Helios Towers Plc abandoned plans for an initial public offering following a report that it could merge with another telecommunications tower operator in Africa, Eaton Towers Ltd.

A merger between the two could take place, given the scope for regional sector consolidation, Merger market reported on Wednesday, citing a person familiar with the situation and two industry advisers. Earlier talks to combine failed due to disagreement on valuation, yet could take place instead of a listing of either business, according to the report, with both firms declining to comment.

The move represents a sea change in what was anticipated to be a wave of African tower company IPOs this year, as owners seek to cash in on a booming industry driven by rising wireless-device use on the continent. IHS Towers, the African market leader, is considering a listing and shareholder MTN Group Ltd.is looking to cash in from the plan, the wireless carrier’s chief financial officer, Ralph Mupita, said last week. Eaton Towers was also mulling a share sale, people familiar with the matter said in November.

Helios shareholders including Soros Fund Management LLC decided not to go ahead with the share sale despite receiving “considerable interest” from potential investors, the company said in a statement Thursday, cancelling plans announced less than two weeks ago. Helios’s valuation expectations were about $2.6 billion including debt, a person familiar with the matter said this month. Helios had planned to sell shares in London and Johannesburg.

Helios “remains committed to executing its growth strategy and reiterates its confidence with respect to the outlook for the business,” the company said.