MTN Increases Investments in Uganda and Ivory Coast

South Africa's MTN has announced that it has increased its shareholding in MTN Uganda to 84.44% from 52.01%, converting the joint venture operation into a fully consolidated subsidiary of the Group. This follows the successful acquisition of a 32.44% stake purchased from Swedish telecom giant, Overseas Telecom for EUR130 (US$166) million. Overseas Telecom is 65%-owned by TeliaSonera.

In May, the MTN Group increased its stake in MTN Cote d'Ivoire, previously Loteny Telecom, to 68.34%, through the purchase of a 17.34% stake from Atlantique Telecom for EUR42.75 (US$54.8) million.

Says Irene Charnley, MTN Group's executive vice-president for the Middle East, North and East Africa Region: "MTN Uganda has performed well over the years amidst intense competition, giving us confidence in the business. We are pleased to have acquired the additional 32.44% in the operation, which boosts our efforts to consolidate our position in the East Africa region and on the continent."

The MTN Group was awarded Uganda's second national operator licence, which included a GSM licence, in 1998, making it the only operation in the Group that operates both mobile and fixed line. Seven years after commercial launch, MTN Uganda continues to perform well despite intense competition, reporting 1,128,000 subscribers at 31 March 2006.

For the nine months ended 31 December 2005, MTN invested US$36 million in network infrastructure, and MTN Uganda has recently been awarded a Government tender to provide infrastructure for universal service in the eastern and western regions of the country. These initiatives will see internet access in some of the most rural areas of Uganda, hence bridging the digital divide.

One of the operation's most notable initiatives was in 2003 when MTN Uganda pioneered access to telecommunications for rural communities in the country with the launch of MTN villagePhone. This was the first replication, outside of Bangladesh, of the successful Grameen Telecom's Village Phone Programme. The project created opportunities for rural individuals to become entrepreneurs operating the MTN villagePhone public pay phones even in areas where electricity is unavailable and the network can only be accessed with booster antennae. MTN Rwanda has since successfully introduced this initiative to the Rwandese market as Tuvugane.

In June 2005, the MTN Group acquired a 51% interest in Telecel Cote d'Ivoire, now known as MTN Cote d'Ivoire. Since the acquisition, the MTN Group has made a sizeable capital expenditure investment of over US$20 million into this operation. The bulk of this investment has been spent on network equipment and information technology systems to support anticipated subscriber growth."

Posted to the site on 10th July 2006