Business Plans

The biggest mobile network across Africa could pull out of West Africa market

Did you know that last week MTN announced that it sold MTN Cyprus to Monaco Telecom for a little over $305 million? If you know anything about MTN’s history, then you should be surprised by that move.

MTN has been on an aggressive expansion plan, and strategically expanded into markets that were often overlooked. That is why the telecom is currently the biggest mobile network across Africa. The MTN Cyprus, was the telecom first attempt into the European market, but it would seem, on that one it chew more than it can swallow. The telecom’s biggest footprint are in Africa and the Middle East.

In recent years, the company’s branches across various countries has been mired by scandals and losses. So much so, that after the sale of the MTN Cyprus, it is now considering pulling out of some countries in West Africa. In its 24 years run, MTN has never pulled out of any market, Cyprus being the first one.

That move has led to speculations that the West African market is also up for review. Rob Shuter, the MTN CEO, is said to be currently reviewing the company’s portfolio and which of the 22 countrieis they are going to scale back.

Since it has experienced a lot of  trouble in West Africa, countries such as Guinea-Bissau, Guinea, and Liberia could be on the chopping board. After Cyprus, MTN has the lowest number of subscribers in Liberia and Guinea-Bissau.

Then there is the $126 million it had to pay in Benin to settle a lincense dispute. In Cameroon, the company parted with another $6.6 million as a penalty for not renewing its license in time. in Ghana, MTN had to sell its shared to local investors to secure a 4G license. Then it faced the mother-of-all-problems in Nigeriia with the famous fine for not registering subcribers SIM cards.

Now it appears the company’s management are thinking that the headaches from the small markets is just not worth it. The company’s management is said to be restrategizing to take advantage of bigger markets like Ethiopia and Angola. And coincidentally, in both markets, the state-owned telecoms are said to be looking to sell off a stake.

In line with internal corporate governance, as well as (Johannesburg Stock Exchange) requirements, MTN does not comment on market speculations.” That is response MTN had when a section of the media approached it for clarificiations on these speculations.

Felix Omondi

Kenyan citizen with a passion for writing for as long as I can remember. In my spare time, I like to blog and read up on trends that's happening around the world.

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