MTN Group on Thursday has tagged some African countries as not business friendly and has began a review to decide whether it really needs to be in all 22 of its markets across Africa and the Middle East.
The teleco said it markets in some of the countries are tiny, others are war-torn while more have regulators desperate to curb its perceived dominance.
While MTN is highly unlikely to leave Nigeria, its biggest market, the carrier has had run-ins with the regulator and was forced to pay a $1 billion fine last year for missing a deadline to disconnect unregistered users.
As part of the fine settlement, it agreed to list its local unit on the Nigerian Stock Exchange (NSE). Talks are also ongoing with the regulator to use spectrum gained from its acquisition of Visafone in 2016.
“Our strategy is to grow our network and we need all the spectrum we can,” its Chief Financial Officer, Ralph Mupita, has said .
In Benin Republic, MTN is in a dispute with regulatory authorities on frequency fees, which it said are too high. “While we are fighting hard to stay in that market, economic sense needs to prevail,” Maputa said.
The telco received a $6.6 million fine from Cameroon’s telecoms regulator and a one-year reduction in its licence term for allegedly not complying with spectrum and subscriber registration regulations. The company was also ordered to disconnect 3 million subscribers. “It’s a big priority to resolve this in the near term. If it’s not resolvable, then it’s not resolvable. We want to find an amicable resolution to stay,” Mupita said.
And in Yemen, Syria, Afghanistan, South Sudan, MTN said it won’t invest in countries it classified as “conflict markets,” which means the local units have to be self-funding to stay in business. The telco will take “appropriate action” if any of them are not cash-flow positive.
“If the markets are able to return to a non-conflict situation they could be attractive to us,” Mupita said. “Syria, for instance, was one of our top 10 markets not so long ago.”
Iran is one of MTN’s top three markets but the company is struggling to repatriate cash that’s been stuck in the country for years due to former U.S.-led and U.K. sanctions. The carrier has managed to repatriate about 6.5 billion rand ($546 million) to date and is in talks with the central bank to move another 5 billion rand later this year.
“They are prioritising foreign-exchange allocation to primary industries such as food goods at the moment,” said Mupita.
MTN has agreed to sell shares in its local unit to Ghanaian investors in exchange for a 4G license.
“The primary objective is not to monetise, but to comply with regulatory requirements for the 4G license,” said Mupita.
Angola plans to sell a minority stake in a state-owned telecommunications provider and hold an auction for a fourth industry operator in 2018.
“We will certainly look at Angola and also Ethiopia if it opened up for a license. There are a couple of countries in West Africa that we could look at, like Togo and Senegal,” the CFO said.
