MTN contemplates sale of stake in Botswana business

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Sources report that MTN is considering the sale of its stake in Botswana’s largest wireless carrier, as the Chief Executive Officer, Rob Shuter seeks to reduce the number of countries in which the company operates.

The sources, who asked not to be named, said a disposal of the interest in Botswana’s Mascom could generate as much as 2.5 billion rand. Since Shuter began a review of MTN’s markets a year ago, 22 at the time, the company has only completed the sale of its Cyprus operation to date.

Shuter plans to sharpen MTN’s attention on growth areas and evaluate where it doesn’t necessarily need a presence. Some countries have been a burden due to local regulatory and government interventions, while markets such as South Sudan and Syria have been ravaged by conflict.

Some countries are tiny when compared to MTN’s largest markets. That includes Botswana, which had almost 1.7 million customers at the end of September, compared with MTN’s 225 million subscribers across Africa and the Middle East.

The deliberations come as MTN prepares to report full year earnings, while fighting fires on several fronts. Most prominently, the carrier is accused of owing $2 billion of back taxes in Nigeria, its biggest market, with a court hearing scheduled for later this month. The company noted 2018 earnings would be hurt by factors including foreign-exchange losses and the settlement of a separate Nigeria dispute for $53 million.

MTN’s Botswana business is also one of only three country units that MTN operates as a joint venture, alongside Iran and Eswatini. MTN bought a 44 percent stake in Mascom in 2005 and co-owns the carrier with local investors.

Sources familiar with the matter also said MTN will like to sell its Liberia, Guinea and Guinea-Bissau businesses in West Africa.

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