Bride at last

MTN ends a losing run in the Middle East with claims that it has been asked to become a stakeholder in Iran's second mobile operator.

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By  Alex Ritman Published  October 20, 2005

Having failed several times before, South African mobile operator MTN has announced that it is moving to the Middle East, having been invited become a 49% stakeholder in Irancell, Iran’s second mobile licence holder. The deal will see MTN take the place of Turkcell, original winner of the bid in 2004. Turkcell has seen its equity position in Irancell fall from the initial level of 70% following concerns that the company did not satisfy foreign investment guidelines established by the conservative Guardian’s Council in Iran. MTN has put forward a guarantee of €300 million (US$359 million) towards the GSM licence, part of the original requirements of the second mobile licence. The development comes amid legal disputes regarding Turkcell’s position in Irancell, with the Turkish operator beginning court action on October 16 in an attempt to reclaim its stake. Political issues had led to disagreements between Turkcell and the Iranian telecommunications ministry. “Turkcell appears not to be willing to accept that it is no longer the first-choice in the process,” says an informed source in Tehran, adding that Turkcell made a number of political errors in pursuit of the licence. According to a statement from Turkcell, it has received no official declarations and any meetings with MTN are not in accordance with applicable laws and regulations approved by the Iranian parliament for the first private GSM tender in Iran. “In this context, the most recent official declaration to our company regarding the deadline for the finalisation of the GSM operator tender in Iran set such deadline as November 21 2005,” the Turkcell statement adds. MTN Group is currently the biggest African operator. Outside of South Africa it has operations in Nigeria, Cameroon, Uganda, Rwanda and Swaziland, and has pre-qualified to participate in the bidding for a 35% stake in Tunisian incumbent, Tunisie Telecom. Earlier this year MTN acquired a controlling stake in Telecel Cote d”Ivoire and has entered into an agreement to take control of Telecel Zambia.

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