MTN sells Botswana unit as start of R15bn asset sale

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The MTN Group has announced that it has divested its stake in a joint venture in Botswana as Africa's largest mobile operator seeks to raise at least $ 15 billion from asset sales and strengthen its balance sheet.

The company agreed to sell its 53% stake in Botswana's Mascom to Econet Wireless Zimbabwe for $ 300 million, the Johannesburg-based company said in a statement on Thursday. Bloomberg News reported the deal earlier this week.

Other companies in the market include e-commerce services, including Nigerian online retailer Jumia Technologies and Travelstart.co.za. MTN also intends to sell its stake in IHS Towers, the company said.

The news came a year after Chief Executive Officer Rob Shuter announced a review of MTN's 22 markets in the Middle East and Africa to assess ways to simplify the business. With the sale of MTN's stake in Botswana, the Cypriot unit was sold for € 260 million.

"We're simplifying the group, reducing risk and improving ROI," Shuter said in a telephone interview. "That will generate some returns that are helpful to our focus and other priorities."

MTN reported the strategy together with adjusted earnings per share for 2018 (excluding some items) of R3.37. Compared to a corporate policy from R3.28 to R3.46. The company increased its medium-term revenue forecasts for service revenues in the double-digit percentage range in the upper single-digit range. Dividend growth will range from 10% to 20%, but by 2019 it is likely to be at the bottom of the range.

challenges

Mobile communications is still facing a number of challenges across its territory. A court in Nigeria has expected an alleged unpaid tax bill of approximately $ 2 billion (about R28 billion at current prices), due later this month.

This is just the latest in a series of controversies in MTN's largest market. At the end of last year, the carrier agreed to pay $ 53 million (about R $ 753 million) to make a separate claim about the illegal repatriation of funds, while a fine of $ 1 billion (over Rs ) led to an annual loss in 2016. MTN plans to record its Nigeria unit in Lagos in the first half of the year.

The $ 53 million effort was one of the one-off costs that MTN had reported in a recently released trade balance as a result for 2018. This includes the effect of a stronger edge compared to the various other currencies that he uses in different markets.

The MTN share has plunged by 39% in the last 12 months and dropped for eight consecutive days. The stock is trading at lows of six months and rated the company with R143bn.

The airline was cautious about the recent challenges in Uganda, where its local CEO was deported last month. MTN granted an extension of its operating license to facilitate renewal negotiations, the company said.

MTN also reiterated that it has "no legal merit" in a $ 4.21 billion lawsuit by Turkcell Iletisim Hizmetleri AS over the granting of its Iran license. The case was re-highlighted in February after South Africa's former ambassador to Iran was arrested for corruption allegations.

The dividend for the full year was R5 per share, while the number of participants in 21 countries rose to 233 million.