MTN exits one of its West African markets, completes sale to Telecel in Guinea-Bissau. The deal, pending regulatory approvals, has been finalized after receiving all necessary approvals.
This move aligns with the Group’s strategic aim of accelerating portfolio transformation and is believed to be in the best interests of MTN Guinea-Bissau, its stakeholders, and the sector in Guinea-Bissau at large.
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MTN revealed in March 2024, that it would be exiting two markets in West and Central Africa (WECA). Agreeing to sell its equity interests in Guinea-Bissau and Guinea-Conakry to Telecel. Following a sale and purchase agreement in December 2023.
In October 2023, the Group received a binding offer to sell MTN Guinea-Bissau and MTN Guinea-Conakry for $1 per company.
Reason behind the sale
MTN Guinea-Bissau had struggled financially after breaching a R171 million ($9.3 million) loan with a lender and became insolvent in December 2023 after its liabilities surpassed its assets. “Assets and liabilities of both MTN Guinea-Bissau and MTN Guinea-Conakry have been presented as held for sale,” MTN said in a report.
The telco decided to focus on its larger regional markets, such as Ghana, Cameroon, and Côte d’Ivoire, which collectively added more than 18% to the group’s revenue compared to other markets. In Ghana, MTN Ghana is classified as a Significant Market Power (SMP).
Moreover, Telecel Global Services received $20 million in February 2024 from the Africa Credit Opportunities Fund (ACOF) and Telecel Group to expand its services in West Africa. Earlier, the telco acquired Vodafone Ghana in February 2023.
Before completing the deal, MTN assured a smooth transition for customers, employees, and other stakeholders. It also acknowledged that Telecel is well-positioned to grow and expand in these markets.
Additionally, MTN Ghana, announcing a 31.2% year-on-year increase in service revenue to GHS8.1 billion in H1 2024, disclosed that it’s in the final stages of long-term agreement discussions with Telecel. MTN Ghana CEO Stephen Blewett mentioned that the telco intends to actively pursue the national roaming agenda in collaboration with Telecel to establish a long-term infrastructure-sharing agreement.
