The South Africa-based operator already has operations in Nigeria, Cameroon, South Africa, Uganda, Rwanda and Swaziland. MTN has been keen to push into developing African markets, as the South African mobile market is now regarded as mature, and its very high mobile penetration rates offers very little growth opportunities.
MTN has now made agreements to buy a 51% stake in Ivory Coast’s Loteny Telecom, which trades as Telecel Cote d’Ivoire, and a 100% stake in Zambia’s Telecel Zambia. The operator gave no financial details, although the deal should increase MTN’s total subscriber base to over 16 million.
Telecel Cote d’Ivoire has a market share of 46% and over 800,000 subscribers. The transaction was cleared by regulatory authorities but is subject to some minor conditions. Cote d’Ivoire is one of two operators in the West African nation.
The country boasts one of the largest ports in sub-Saharan Africa and an outstanding infrastructure with a network of over 16,000km of paved roads, making the Ivory Coast an attractive investment opportunity for us, said Yvonne Muthien, group executive for corporate affairs at MTN.
She says the country has recorded one of the highest growth rates for GSM services in Africa over the last five years and growth potential still remains high, given the current mobile penetration rate of approximately 11%.
Yet while the country is the world’s top cocoa grower, it is currently still in the middle of a civil war after a failed coup attempt in 2002. The rebels control most of the north, while the government runs the south. A combination of 4,000 French troops and 6,000 UN peacekeepers are keeping the warring factions apart.
Zambia meanwhile is a far more stable country. The purchase of Telecel Zambia offers MTN the potential for large growth in the region, providing the operator receives regulatory and competition approval for the acquisition from the relevant Zambian authorities.
Telecel Zambia is the second largest mobile operator, out of a total of three operators, in the southern African nation. It has an estimated market share of around 21% (or 360 000 subscribers), in a country with a 3% mobile penetration rate.
