Africa’s largest mobile network operator MTN has accelerated plans to exit the Liberian market as it cites low yields on investment.
As it was announcing its results for the first quarter of 2023, MTN said it was considering an offer from Madagascar conglomerate Axian to acquire the South African group’s subsidiaries in Guinea, Guinea-Bissau and Liberia.
“MTN Group is evaluating an orderly exit of three operations in West Africa over the medium-term; namely MTN Guinea-Bissau, MTN Guinea-Conakry and MTN Liberia. In this
regard, the Group has received an offer for our equity interests in these Opcos, from Axian Telecom, which is being evaluated, the company said in an update.
“As at 31 March 2023, the combined subscriber base of the three Opcos represented approximately 6.1 million of the Group’s total 291 million subscribers, and
contributed 0.7% to EBITDA. As we are at an early stage of deliberations, we emphasise that any process of this nature will entail extensive engagements with stakeholders who will be appropriately informed as and when the evaluation process has materially progressed.”
“The agreement has not been finalised and there is no guarantee that the transaction will take place,” says US news agency Bloomberg.
The head of Axian, Hassanein Hiridjee, told us he did not wish to comment “beyond what has been written [by MTN]”. Two experts in the sector, well aware of the movements of mergers and acquisitions, say they have no information on these negotiations, which are being conducted in strict confidence.
MTN operates in 18 countries, 17 of which are in Africa. The group has been implementing its new ‘Ambition 2025’ strategy for the past three years, reviewing its
portfolio to focus on its most dynamic markets.
The company .is planning price increases in certain markets, as Africa’s largest wireless carrier battles with inflationary pressures on the continent.
The telecom company said in a trading update, it will continue to talk to regulators over the proposed price increases. Inflation across MTN’s footprint averaged 18.5%
during the first quarter, compared with 11.5% a year earlier, it said.