MTN shows faith, buys into Nige­rian broad­band

CityPress - - Busi­ness -

The MTN Group has agreed to buy in­ter­net provider Visa­fone Com­mu­ni­ca­tions of Nige­ria to ex­pand in Africa’s big­gest econ­omy – even as the South African com­pany awaits a lo­cal court rul­ing on a record $3.9 bil­lion (R63 bil­lion) fine in its big­gest mar­ket.

The ac­qui­si­tion will en­sure “Nige­ri­ans ex­pe­ri­ence a boost in the qual­ity of broad­band in­ter­net ser­vices” and data speeds, MTN Nige­ria ex­ec­u­tive Amina Oyag­bola said in an emailed state­ment on Fri­day, with­out dis­clos­ing terms.

Visa­fone of­fers voice as well as on­line ser­vices in Nige­ria, ac­cord­ing to the state­ment.

On De­cem­ber 17, MTN said it would ask a La­gos court to rule on the fine, im­posed by the Nige­rian telecom­mu­ni­ca­tions reg­u­la­tor for the com­pany’s fail­ure to meet a dead­line to dis­con­nect 5.1 mil­lion un­reg­is­tered sub­scribers. The ini­tial fine of $5.2 bil­lion was re­duced by 25% ear­lier in De­cem­ber, fol­low­ing talks with the reg­u­la­tor led by MTN chair­per­son Phuthuma Nh­leko.

MTN shares have de­clined by 34% since the fine was made pub­lic on Oc­to­ber 26, valu­ing the com­pany at $14.5 bil­lion. On Fri­day morn­ing, the stock was trad­ing 0.6% higher in Jo­han­nes­burg, at R127.01.

La­gos-based Visa­fone is a wire­less net­work provider founded in 2007 by Jim Ovia, a Nige­rian busi­ness­man who also cre­ated Zenith Bank.

MTN had about 62.5 mil­lion sub­scribers in Nige­ria at the end of Septem­ber, al­most a quar­ter of its to­tal of 233 mil­lion cus­tomers.

– Bloomberg

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.