Etisalat challenges MTN’s acquisition of Visafone

8 Feb 2016

Etisalat Nigeria has launched legal action against mobile market leader MTN Nigeria, over its acquisition of CDMA operator Visafone, arguing that the move will consolidate the South African firm’s dominance in the retail data services market. Local newspaper This Day cites a statement from Etisalat as saying that the Nigerian Communications Commission’s (NCC’s) decision to approve MTN’s purchase of Visafone, which holds LTE-suitable 800MHz spectrum, will give the market leader an unfair advantage in rolling out 4G mobile broadband services in Nigeria. ‘The use of the 800MHz spectrum to deploy broadband services ahead of its competitors, particularly those who, prior to MTN’s purchase of Visafone, held similar spectrum bands as MTN, will further entrench MTN’s dominance in the Nigerian telecommunications sector,’ the statement from Etisalat said, adding: ‘We have, in addition and in line with Section 86 of the Nigerian Communications Act, 2003, engaged the NCC to understand the basis of its decision to approve the acquisition. As you are aware, the matter is already in court; as such, we are restrained from commenting further.’

As previously reported by CommsUpdate, South Africa’s MTN Group completed the process of acquiring Lagos-based Visafone, which was formed in June 2007 by Nigerian businessman Jim Ovia, at the start of this year. In recent years, Visafone has faced increasing competition from more popular GSM-based services; mobile subscriber numbers have fallen gradually since reaching a peak of 2.801 million at mid-2009, dropping to 2.03 million by the end of September 2015 to give it a market share of just 1.3%, compared to MTN Nigeria with 62.49 million subscribers (41.5%) at the same date.