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South African mobile phone companies...
2006-01-04 14:28:18
By JOHANNESBURG
South African mobile phone providers are looking back on a bright year, having left a large footprint on the African continent as cellphones become the communication tool of choice for millions from Cape Town to Cairo.
MTN and Vodacom, the country’s largest two mobile operators have acquired or are finalising offers estimated at over 500 million dollars (420 million euros) in Africa this year, placing them at the top of the market.
’It’s been a very good year for South Africa’s mobile operators,’ said Reg Rumney, director of the Johannesburg-based economic think-tank BusinessMap.
’The reason why they’ve done so well is because they are probably better adaptable to conditions on the continent, which is a high-risk, high-reward market,’ he told AFP.
Mobile phones are today the communication tool of choice in Africa, having overtaken fixed-line phones in 2001, according to the International Telecommunication Union.
Forty-three of Africa’s 53 countries have more mobile than fixed line subscribers and 70 percent of all African telephone users are mobile phone subscribers.
Set up in 1994 with the end of apartheid in South Africa, the MTN (Mobile Telephones Network) Group now operates in nine African countries and boasts 20.6 million subscribers continent-wide.
The company has made a number of successful acquisitions this year.
MTN announced last week it had bought Libertis Telecom, one of two cellular operators in Congo-Brazzaville for a total of 102.5 million dollars, snatching up around 190,000 new subscribers.
Its largest acquisition this year was a majority stake in the Ivory Coast’s Loteny Telecom, trading as Telecel Cote d’Ivoire, for 208 million dollars.
In Botswana, a 128 million-dollar deal ensured a 44 percent indirect stake in Mascom Wireless, while it also bought up Telecel Zambia for 47 million dollars.
Beyond Africa, MTN in October announced it had bought a 49 percent stake in the IranCell consortium to provide mobile phone service to 16 million users over the next 15 years. The deal is worth around 360 million dollars.
’MTN will continue to pursue value enhancing opportunities in the Middle East and north and sub-Saharan Africa,’ said MTN Group executive director Santie Botha.
’The identification of opportunities has remained a key priority for the MTN group,’ she said.
Vodacom made its last investment outside of South Africa in 2003 in Mozambique and the company said it used the year to concentrate on its operation within the country.
In February, it bought Tiscali South Africa’s cellular subscriber base for 40.1 million rand (6.3 million dollars, 5.3 million euros), while it has made an offer for a majority stake in Cointel VASA for 122.2 million rand.
Both companies described the lack of infrastructure in Africa, with poor roads and haphazard electricity supply as the biggest challenges for expansion.
Botha said MTN had ’overcome a number of obstacles such as lack of infrastructure, intermittent power supply and the demand for services’ including in Nigeria where it has invested nearly 900 million dollars in infrastructure in 2004.
MTN says it has invested more than 24 billion rand in total in infrastructure development on the African continent. ’Yes, it is difficult to set up a cellphone network,’ said a Vodacom spokesman, who declined to be named.
’But we will continue to invest in the continent because the cellphone industry underpins the key to unlocking Africa’s untapped economic potential.’
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