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The South African time in the region has been mired in controversy and has now proved more trouble than its worth
MTN is set to gradually retreat from its Middle Eastern businesses, said CEO Rob Shuter on a conference call yesterday. Instead, MTN will focus its efforts back on its home continent of Africa.
MTN’s time in the Middle East, where it operates in Iran, Yemen, and Syria has been a troubled experience over the past 15 years. The operator has been entangled in numerous controversies, from accusations of bribery, violating sanctions, and even paying protection money to terrorist organisations in Afghanistan.
Now, with the regions assets contributing just 4% of the group’s overall earnings, it seems that MTN has come to accept that its Middle Eastern businesses are simply not worth the effort, with Shuter saying that the markets were for them a "very small contributor in a very complex environment".
The withdrawal will be begin with the sale of its 75% stake in MTN Syria, with the owner of the remaining 25% equity, TeleInvest, apparently in talks to buy out the business.
Shuter was quick to point out that leaving the region would not be a quick process and instead would take place gradually over the next three-to-fiveyears.
"This is not some kind of fire sale. This will be done in a very orderly and responsible way over the next few years," he said.
The asset sales are part of the group’s wider divestment plan, which aims to raise around $1.42 billion over the next three-to-give years.
With the Middle East proving problematic for MTN, there are plenty of African markets available to take its place. Ethiopia is perhaps the most exciting of these, with the breakup of one of the world’s last remaining telecoms monopolies offering enormous potential for any telco lucky enough to gain access. MTN is one of around a dozen foreign operators currently vying for of the two telco licences which Ethiopia is set to make available in the near future.
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