Tough business environment forces MTN Group to consider sale of West African assets

NAIROBI, Kenya - Africa's largest mobile operator-MTN Group Ltd is reportedly in advanced talks to sell some of its assets to Axian Group Ltd. According to sources familiar with the matter, negotiations on the prices of MTN's assets in Liberia, Guinea-Bissau, and Guinea-Conakry are ongoing.

Data compiled by Bloomberg, the three West African countries accounted for 1.6 percent of MTN's revenue in 2022. The deal, which has not yet been finalized, could see MTN selling some of its assets as it narrows its focus and resources on core markets, including Nigeria and Ghana.

MTN is one of the most valuable companies in Africa, with a significant presence in 19 countries in the region. The company's mobile phone services have become an essential part of everyday life for millions of people, and it has consistently been a top performer in the annual ranking of Africa's top 250 listed companies by African Business.

However, the combined market capitalization of the top 250 companies has fallen from $701 billion to $561 billion since last year's survey, impacting MTN's overall value. The decline in the market value of companies across the continent is primarily attributed to the COVID-19 pandemic, which has disrupted supply chains, reduced demand, and slowed economic growth.

Despite these challenging business conditions that have affected many African companies, MTN remains focused on optimizing its portfolio and evaluating its assets in different countries. According to Bloomberg, MTN's CEO, Ralph Mupita, has been evaluating the company's portfolio in recent months. The move to sell some of its West African markets comes as part of a broader strategy to trim its portfolio and streamline its operations.
The move could also indicate a broader trend in the market, as companies continue to evaluate their portfolios and focus on core.

GAROWE ONLINE