MTN has partnered with incubator Rocket Internet and telecoms and media company Millicom International Cellular to drive online retail and other digital services on the African continent.
According to MTN, the three entities will develop Internet businesses in Africa through Africa Internet Holding (AIH), an exclusive vehicle to develop e-commerce businesses across the continent. MTN, Millicom and Rocket Internet will each become 33.3% shareholders in AIH.
MTN CEO Sifiso Dabengwa says the partnership is underpinned by a joint strategy to develop online ventures across the fast-growing Internet markets of Africa. He believes Rocket Internet's "successful track record" - coupled with Millicom and MTN's positions in the telecoms arena - will stand AIH in good stead to "capture the growth potential of the digital media space across our footprint in the region".
Founded in 2012 as a joint venture between Rocket Internet and Millicom International Cellular, Internet group AIH has presence in 13 countries on the continent, including SA, Nigeria, Egypt, Morocco, Cote d'Ivoire and Ghana. The company has developed several e-commerce ventures in the last 18 months, including Jumia, Zando, Kaymu, Jovago, Lamudi, Carmudi, Easytaxi and Hellofood.
Digital drive
Millicom President and CEO, Hans-Holger Albrecht, says the entry of MTN will accelerate the growth of the company's online alliance in Africa. "It is a significant vote of confidence in its future. Between us we have more than 220 million mobile customers in the continent with very limited overlap. MTN is the leader in Nigeria and SA, the largest markets for AIH currently."
MTN says its investment in AIH is in line with the operator's strategy of "bringing the digital world to customers".
Oliver Samwer, co-founder of Rocket Internet, says the partnership is unique and will enable AIH to reach more consumers with better services.
The partnership is expected to create additional synergies for MTN in its core business. The investment is subject to regulatory approval, and the transaction is expected to close during the second quarter of 2014.
"MTN will continue to pursue digital business adjacencies as one of its key strategic priorities to drive growth and value to our customers across Africa," says Dabengwa.
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