MTN accelerates Middle East departure, exits Yemen
Pan-African telecoms giant MTN Group has exited Yemen, as the company presses ahead with its plans to disinvest in the Middle East.
MTN announced today it has agreed to withdraw from its operations in Yemen, through a transfer of its shareholding to a minority shareholder in MTN Yemen, Emerald International Investment, and a subsidiary of Zubair Investment Centre.
Detailing its Yemen departure in a statement, the telco says: “MTN Yemen had 4.7 million subscribers at the end of third quarter 2021 and, as disclosed in the reviewed first half year 2021 results data sheets, represented 0.3% of group EBITDA.
“MTN Yemen operates on a 2G licence, which is due for renewal on 31 December 2021. The group fully impaired the consolidated net assets of MTN Yemen as at 30 June 2021 and no further material impact is therefore expected on earnings as a result of the exit.”
Today’s development is in line with MTN’s broader strategy announced in August 2020.
Africa’s largest mobile operator at the time explained the departure plan from its Middle East operations to focus on its burgeoning operations on the continent.
MTN said it was simplifying its portfolio, and the Middle East operations, which contribute less than other regions, were to be offloaded.
Since then, MTN has abandoned its Syria operations after having an acrimonious relationship with the regulator, which the telco described as toxic.
Before the abrupt departure from Syria, MTN executive management had been relieved of its duties and a Syrian court appointed the chairman of minority shareholder TeleInvest, to manage the company’s day-to-day operations.
“The group has initiated an exit of Syria, through abandoning the operation, given regulatory actions and demands that make operating in the market untenable. We reserve our rights to seek redress through international legal processes, given the actions of the Syrian authorities that have left us with no other choice than to exit,” CEO Ralph Mupita said at the time.
Middle East operations have been prickly for MTN over the years, as the telco has been battling fires from multiple fronts.
The telco is currently defending itself in a US court following fresh allegations in an amended lawsuit that MTN “was a particularly aggressive practitioner of protection payments” to terror group al-Qaida in Afghanistan.
MTN is being accused of violating US anti-terrorism laws.
In Iran, the mobile operator has repeatedly rebuffed bribery allegations following accusations by Istanbul-based Turkcell that MTN engaged in illicit activity to gain its GSM licence in Iran in 2005.
Turkcell claims MTN used bribery and corruption to overturn the initial Iranian decision so that the licence was awarded to Irancell, of which the MTN group owns 49%.
While plans are afoot to depart Tehran, Mupita recently cautioned in a call with analysts that “Iran is a longer-term story”.
Earlier this month, Mupita addressed analysts during his update for the third quarter, which ended September, saying: “We are encouraged by talks that the Iranian authorities and the P5+1 will meet in Vienna at the end of the month.”
The P5+1 refers to the UN Security Council’s five permanent members (the P5); namely China, France, Russia, the United Kingdom and the United States, plus Germany.