MTN on path to further investments

MTN, which established a corporate office in Tehran earlier this year, is observing the outcome of frantic negotiations taking place between the Iranian shareholders and Turkcell, the driving force behind the country’s second licensee Irancell, regarding Turkcell’s authorisation to manage the operator.

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By  Tawanda Chihota Published  June 28, 2005

Less than two weeks after MTN Group CEO Phuthuma Nhleko said the company had no immediate investment targets, the operator has moved quickly in the acquisition of investments in Zambia and Cote d’Ivoire and is poised for participation in the Iranian and Namibian mobile markets. MTN, which established a corporate office in Tehran earlier this year, is observing the outcome of frantic negotiations taking place between the Iranian shareholders and Turkcell, the driving force behind the country’s second licensee Irancell, regarding Turkcell’s authorisation to manage the operator. Turkcell has seen its equity participation in Irancell reduced from 70% to 49% and is now contesting the proposed loss of management control of the operator. MTN was beaten to the second licence by Turkcell last year, but has remained interested in participating in the market, hoping to come in as Iran’s third operator during the course of 2006. “No one outside of the parties involved quite knows what the position is,” a source in Tehran said. MTN has made it clear that it would be willing to agree to the political guidelines established in respect to foreign investment in Iran and is willing to speak to local authorities regarding taking over the second licensee should things develop in that direction. Iranian investors in Irancell are reported to have resumed negotiations with Turkcell regarding the Turkish company’s continued participation in the project and a final decision is expected to be communicated to the Economy Council, Iran's highest economic decision-making body, for approval by July 1. In Namibia, the state telco Post and Telecommunications Holdings (NPTH) is understood to be looking for a strategic shareholder to take a 34% stake in its mobile operator Mobile Telecommunications Limited. NPTH has invited expressions of interest and the deadline for submissions is set for July 15. MTN is considered to be an obvious potential bidder. “MTN continues to identify value-enhancing expansion opportunities in line with the Group’s vision to be the leader in telecommunications in developing markets,” commented Yvonne Muthien, corporate affairs executive of MTN, when asked about the company’s level of interest in investing in Namibia. In line with this strategy, MTN recently announced it had acquired a 51% stake in Telecel Cote d’Ivoire and 100% of Telecel Zambia. Telecel Cote d'Ivoire is the second placed operator in a two-player market and has around 800,000 subscribers, while Telecel Zambia is the second out of three operators, in Zambia, and counts more than 90,000 GSM users.

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