Business Combinations (Tables)

9 Months Ended

Sep. 30, 2022

Business Combinations

Schedule of fair value adjustments in accordance with IFRS 3

	As reported		As re-presented
	December 31, 2021	Adjustments	December 31, 2021
	$’000	$’000	$’000
Goodwill	787,665	(7,769)	779,896
Other intangible assets	830,439	15,290	845,729
Trade and other receivables - current	469,130	2,623	471,753
Deferred tax liabilities	(163,920)	(5,199)	(169,119)
Non-controlling interest	(218,243)	(4,945)	(223,188)

MTN telecom towers in South Africa

Business Combinations

Summary of consideration paid and the fair value of assets and liabilities acquired at the acquisition date

	2022
	$’000
Gross consideration	421,239
Net cash consideration	421,239
Identifiable assets acquired and liabilities assumed:
Towers and tower equipment	287,247
Customer related intangible asset	128,827
Network related intangible asset	66,814
Right of use asset	97,027
Lease liabilities	(97,027)
Deferred tax	(54,778)
Provisions for other liabilities and charges	(69,327)
Total identifiable net assets acquired	358,783
Goodwill	62,456
Revenue — post‑acquisition	40,927
Loss — post‑acquisition	(13,788)

Sao Paulo Cinco Locacao de Torres Ltda (SP5)

Business Combinations

Summary of consideration paid and the fair value of assets and liabilities acquired at the acquisition date

	2022
	$’000
Gross consideration	317,188
Less: cash in business at the date of acquisition	(1,896)
Net cash consideration	315,292
Identifiable assets acquired and liabilities assumed:
Towers and tower equipment	13,395
Land	885
Customer related intangible asset	179,903
Network related intangible asset	2,605
Goodwill	438
Right of use asset	82,784
Trade and other receivables	23,575
Trade and other payables	(4,222)
Deferred tax	(69,810)
Total identifiable net assets acquired	229,553
Goodwill	85,739
Revenue — post‑acquisition	23,287
Profit — post‑acquisition*	6,082

Skysites Holdings S.A.

Business Combinations

Summary of consideration paid and the fair value of assets and liabilities acquired at the acquisition date

	2021
	$’000
Gross consideration	40,611
Less: contingent consideration*	(4,169)
Less: cash in business at the date of acquisition	(2,775)
Net cash consideration	33,667
Identifiable assets acquired and liabilities assumed:
Towers and tower equipment	11,276
Land	15
Furniture and office equipment	11
Capital work in progress	535
Customer related intangible asset	4,703
Right of use asset	9,675
Trade and other receivables	713
Trade and other payables	(1,132)
Provisions for other liabilities and charges	(2,548)
Lease liabilities	(10,071)
Deferred tax	(2,205)
Total identifiable net assets acquired	10,972
Goodwill	26,864
Revenue — post‑acquisition	3,033
Loss — post‑acquisition	(267)

*Contingent consideration consists of $4.2 million of consideration due at a future date which is recognized at fair value on the date of acquisition. The contingent consideration relates to a pay-out if a certain number of sites were rolled out post-acquisition and the quality of the acquired sites. As at December 31, 2021 certain contingencies were not met and $1.3 million of the contingent consideration was released to the consolidated statement of loss and other comprehensive income in 2021. $2.9 million remains as contingent consideration.

Centennial Towers Colombia, S.A.S. and Centennial Towers Brasil Cooperatief U.A.

Business Combinations

Summary of consideration paid and the fair value of assets and liabilities acquired at the acquisition date

	Brazil	Colombia	Total
	2021	2021	2021
	$’000	$’000	$’000
Gross consideration	93,900	47,051	140,951
Less: cash in business at the date of acquisition	(260)	(659)	(919)
Net cash consideration	93,640	46,392	140,032
Identifiable assets acquired and liabilities assumed:
Towers and tower equipment	43,890	14,074	57,964
Land	407	546	953
Furniture and office equipment	65	17	82
Capital work in progress	628	500	1,128
Right of use asset	22,273	9,761	32,034
Customer related intangible asset	35,422	32,599	68,021
Network related intangible asset	594	321	915
Software	495	1	496
Trade and other receivables	2,363	3,023	5,386
Trade and other payables	(1,471)	(3,646)	(5,117)
Provisions for other liabilities and charges	(5,272)	(527)	(5,799)
Lease liabilities	(24,028)	(10,458)	(34,486)
Tax payable	(2,809)	(625)	(3,434)
Deferred tax	(15,374)	(10,907)	(26,281)
Total identifiable net assets acquired	57,183	34,679	91,862
Goodwill	36,457	11,713	48,170
Revenue — post‑acquisition	4,408	1,948	6,356
Profit/(loss) — post‑acquisition	2,469	(1,762)	707

FiberCo Solues de Infraestrutura S.A.

Business Combinations

Summary of consideration paid and the fair value of assets and liabilities acquired at the acquisition date

	As reported		As re-presented
	December 31, 2021	Adjustments	December 31, 2021
	$’000	$’000	$’000
Gross consideration	263,366	(2,701)	260,665
Contingent consideration*	5,739	—	5,739
Less: deferred consideration	(66,840)	2,701	(64,139)
Net cash consideration	202,265	—	202,265
Capital injection**	42,996	—	42,996
Identifiable assets acquired and liabilities assumed:
Network assets	226,538	7,271	233,809
Cash	44,872	—	44,872
Capital work in progress	3,832	—	3,832
Software	539	—	539
Customer related intangible asset	96,997	16,162	113,159
Network related intangible asset	35,832	(419)	35,413
Trade and other receivables	75,338	—	75,338
Trade and other payables	(5,764)	(7,271)	(13,035)
Loans payable	(6,457)	—	(6,457)
Deferred tax	(47,062)	(5,353)	(52,415)
Total identifiable net assets acquired	424,665	10,390	435,055
Non-controlling interest	208,086	5,091	213,177
Goodwill	89,783	(8,000)	81,783
Revenue — post‑acquisition			n.a.
Profit/(loss) — post‑acquisition			n.a.

*Contingent consideration consists of $5.7 million of consideration receivable at a future date which is recognized at fair value on the date of acquisition. The contingent consideration relates to a pay-out if certain conditions are met post-acquisition around homes connected, homes passed, and churn.

** The capital injection relates to a payment made to I-Systems for the issuance of new share capital as part of the acquisition agreement to achieve the agreed shareholding structure post acquisition.

IHS Kuwait Limited

Business Combinations

Summary of consideration paid and the fair value of assets and liabilities acquired at the acquisition date

	2022	2021
	$’000	$’000
Gross consideration	2,729	12,248
Less: consideration received in exchange for a retained 30% interest (by Zain) in IHS GCC KW	(819)	(1,837)
Net cash consideration for 70% controlling interest**	1,910	10,411
Identifiable assets acquired and liabilities assumed:
Towers and tower equipment	1,032	7,902
Customer-related assets	1,947	5,449
Network-related assets	671	1,877
Trade and other receivables	—	872
Trade and other payables	(921)	(3,852)
Total identifiable net assets acquired (at 100%)	2,729	12,248
Goodwill	—	—
Determination of non-controlling interest
Total identifiable net assets acquired (at 100%)	2,729	12,248
Shareholder funding provided by the Group and external debt*	—	(6,124)
	2,729	6,124
Non-controlling interest portion of above at 30%	819	1,837
Revenue — post‑acquisition	n.a.	n.a.
Profit/(loss) — post‑acquisition	n.a.	n.a.

* This was shareholder funding provided by the Group and recorded as short term liabilities in IHS GCC KW. These funds were loaned to IHS Kuwait to fund the acquisition of the towers from Zain. This short term liability was subsequently replaced by external debt.

** The consideration for the fifth stage that was completed during the period ended September 30, 2022 was paid after the reporting period.