Syrian authorities have invited bids for MTN’s licence as the JSE-listed group formally begins its exit from the country after halting operations there in 2021.
On Wednesday the group said its CEO, Ralph Mupita, met with Abdulsalam Haykal, Syria’s minister of communications and information technology, to formalise an agreement “to regularise MTN’s exit from Syria, with the intention both sides implement the agreement imminently”.
In August 2021, MTN wrote off and abandoned its business there after clashes with the government complicated its efforts to offload the unit.
The group described the situation as “regulatory actions and demands that made operating in the country untenable”.
MTN Syria has continued to operate under the country’s government, which had been MTN’s partner on the venture. The group began operating in Syria in 2006.
Through this week’s meeting, MTN has begun the process to exit the business, which entails relinquishing its operating licence. That process is under way, with the Syrian government inviting bids for a 20-year licence to replace MTN Syria in its market.
The parties met on the sidelines of the Mobile World Congress in Barcelona.
MTN’s protracted exit puts the spotlight on the complexity of profitably exiting unstable, war-torn countries for the company in the midst of sharpening its focus on Africa.
The group, which had developed a reputation for conquering emerging market countries few dare to touch, is in the process of exiting businesses in the Middle East region, including Afghanistan, Yemen and Iran.
This was initially part of a five-year slim-down plan unveiled in 2019 to reduce risk, sell non-core assets such as towers and masts and raise about R25bn.
Africa’s largest telecoms provider has since sold off the Afghanistan and Yemen entities but continues to struggle with exiting Iran, a unit that has for years caused headaches for MTN, “but this has been complicated by US sanctions”.
In February 2021, MTN’s Syrian operation was placed under curatorship as authorities there accused the MTN subsidiary of mismanagement and violation of its operating licence conditions. This effectively took operational control of the business away from MTN.
This comes a few days after the company said it expects to report sharply higher full-year earnings following “pleasing operational progress and a supportive macroeconomic environment in key markets”.
The group, valued at R367bn on the JSE, expects to report HEPS for the year to end-December of between R12.64 and R12.84 compared with 98c a year ago, it said on Monday.
Business Day
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