MTN demands extraordinary meeting
JOHANNESBURG - Africa’s largest mobile operator, MTN, has called for an extraordinary shareholders’ meeting of New York-listed IHS Towers as it battles the group’s Board over voting rights.
MTN holds 26 per cent of IHS, which was founded in Nigeria and operates nearly 40 000 towers in Africa, the Middle East and South America, but its voting rights are capped at 20 per cent.
According to Bloomberg, MTN, along with French investment company Wendel – which owns 19 per cent – demands that those holding 10 per cent or more of IHS get to nominate board members, but this had been dismissed by IHS.
Engaging
The group said on Tuesday it has been engaging IHS on corporate governance matters, including its voting rights, but IHS failed to notify shareholders of its proposal or allow them to vote on it at its annual meeting on June 7.
MTN doesn’t have a representative on the IHS board, although its former Chief Executive Officer (CEO), Phuthuma Nhleko, is a non-executive director.
MTN said on Tuesday it ‘strongly believes that IHS has wilfully breached’ its shareholder agreement by failing to place the proposal on the agenda, notify all other shareholders, and allow them to vote on it.
IHS didn’t immediately respond to questions sent by News24 on Tuesday, but told Bloomberg earlier in June it didn’t consider the proposal to be in the best interest of its shareholders as a collective.
It said MTN’s lack of rights to appoint board members was agreed as part of the initial public offering to preserve its independence from MTN, which is one of its big customers.
Towers
In 2022, MTN sold its more than 5 700 towers to IHS for R6.4 billion under a leaseback agreement.
The mobile operator has been looking to dispose of the non-voting portion of its shares in IHS, but has said it has been unable to do so given its view that IHS’s share price “materially undervalues” the business.
IHS shares have about halved in value since listing in October 2021.
IHS was founded by Lebanon-born Sam Darwish in Nigeria in 2001. He remains chairperson and CEO of IHS. The board also includes former Florida governor and failed candidate for the US presidency, Jeb Bush, along with the former CEO of Xerox, Ursula Burns, who also sits on the Uber and Nestle Boards.