Get more Mail & Guardian
Subscribe or Login

MTN feathers its bed in the Middle East

Spurned in its bid to acquire Celtel, which has licences in 13 African countries, MTN has set its sights on the Middle East.

First prize would be a stake in the Irancell consortium, now potentially up for grabs after the Iranian government baulked at handing over 70% of the licence to Turkish operator Turkcell.

Reuters reports that MTN last week held discussions with Irancell shareholders, even after Turkcell had signed an agreement to acquire 49% of Irancell. Negotiations between Irancell and Turkcell broke down over accusations of foot dragging about the payment of licence fees. Iran is reportedly unwilling to hand control of key infrastructure to foreigners, and “accused Turkcell of links to Iran’s foe Israel,” according to Reuters.

Iran has a population of nearly 70-million, with a cellphone pene-tration of just 8%. Irancell plans to challenge the incumbent operator TCI for dominance of what is regarded as the most promising market in the Middle East.

MTN has been frustrated in its efforts to enter the Middle Eastern market, having lost a number of tenders for mobile licences. It also lost out to MTC Kuwait in its bid for Celtel, Africa’s third-largest operator, which has more than six million customers in 13 African countries.

Analysts believe MTN may have better success tackling the Middle East in partnership with established players in this market. Business Report this week reported that MTN will hold talks with a member of Bahrain’s royal family about setting up a partnership that would help it expand in the Middle East.

Pallavi Ambekar, telecommunications analyst with Coronation Asset Managers, says the Iranian market would be first prize for MTN, which has made no secret of its plans to expand in the Middle East.

Johan Snyman, telecommunications analyst at First South Securities, says MTN’s move into the Middle East will broaden its geographical footprint outside of Africa. “The Middle East is wealthier than Africa so the potential for market growth is strong. I also have a sense that MTN may start running out of growth in Africa in the foreseeable future.”

MTN has operations in Nigeria, Rwanda, Cameroon, Uganda, Swaziland, Mauritius, and recently bought 100% of Telecel Zambia and 51% in Telecel Côte d’Ivoire. This gives it 18-million customers in nine African countries, 44% of them in South Africa. It is also on the short-list to acquire 51% of Nigerian fixed-line operator Nitel and its cellphone subsidiary M-Tel.

Subscribe for R500/year

Thanks for enjoying the Mail & Guardian, we’re proud of our 36 year history, throughout which we have delivered to readers the most important, unbiased stories in South Africa. Good journalism costs, though, and right from our very first edition we’ve relied on reader subscriptions to protect our independence.

Digital subscribers get access to all of our award-winning journalism, including premium features, as well as exclusive events, newsletters, webinars and the cryptic crossword. Click here to find out how to join them and get a 57% discount in your first year.

Ciaran Ryan
Guest Author

Related stories

WELCOME TO YOUR M&G

If you’re reading this, you clearly have great taste

If you haven’t already, you can subscribe to the Mail & Guardian for less than the cost of a cup of coffee a week, and get more great reads.

Already a subscriber? Sign in here

Advertising

Subscribers only

R350 social relief grant not enough to live on

Nearly half of the population in South Africa — one of the most unequal countries in the world — is considered chronically poor.

More top stories

Afrobeats conquer the world

From Grammys to sold-out concerts, the West African music phenomenon is going mainstream

R350 social relief grant not enough to live on

Nearly half of the population in South Africa — one of the most unequal countries in the world — is considered chronically poor.

US fashion contaminates Africa’s water

Untreated effluent from textile factories in in Lesotho, Ethiopia, Kenya, Mauritius and Madagascar pours into rivers, contaminating the water

Deep seabed mining a threat to Africa’s coral reefs

The deep oceans are a fragile final frontier, largely unknown and untouched but mining companies and governments — other than those in Africa — are eying its mineral riches
Advertising

press releases

Loading latest Press Releases…
×