MTN circles as Telecel flounders

26 Feb 2015

South African telecoms group MTN is reportedly looking for a new opportunity to enter the Zimbabwe wireless sector, with struggling operator Telecel seen as a potential investment. A report from The Financial Gazette says MTN has had representatives in Zimbabwe for the past two weeks to hold meetings with government officials and local banks, though there has been no concrete news of a move for a local operator.

Telecel, the smallest of the country’s three cellcos, is facing the cancellation of its licence after the government decided last week to halt an agreement allowing the operator to defer licence fee payments. The firm’s ownership is also in flux, with Russia-based, Netherlands-headquartered group Vimpelcom looking to divest its 60% stake and members of local investment consortium Empowerment Corporation also seeking ways of exiting the venture. Local press reports have suggested that Telecel could be taken under government control and then have a 49% stake sold off to a new international partner such as MTN, with 51% of shares reserved for local black investors.

MTN had previously attempted to enter the Zimbabwean mobile market through an acquisition of a 49% interest in state-owned cellco NetOne in 2010, though the deal collapsed with some government members opposed to the privatisation of NetOne.

Zimbabwe, MTN Group, Telecel Zimbabwe