Private equity investor Mediterrania Capital Partners (MCP) is considering investments in supermarkets, health and education as the impact of COVID-19 whittles down the list of financially strong candidates, CEO Albert Alsina tells The Africa Report.
Privatisations in Ethiopia: could MTN pull off a surprise?
Two leading telecoms operators – France’s Orange and Kenya’s Safaricom – have publicly announced their bids to acquire one of two licences which Ethiopia plans to grant by the end of March 2020. However, South Africa’s MTN has not necessarily said its last word.
Orange, led in the Middle East and Africa by Senegalese national Alioune Ndiaye, and Kenya’s Safaricom, which has teamed up with its pan-African stakeholder Vodacom (a subsidiary of UK-based Vodafone), have long expressed their interest in the Ethiopian market.
An Ethiopian telecommunications licence could cost as much as $1bn, including network deployment costs, according to Michael Joseph, who is serving as Safaricom’s acting chief executive officer until former Diageo executive Peter Ndegwa’s arrival in April.
Will this barrier to entry be enough to keep out South Africa’s MTN Group, which has been reluctant to articulate clearly its intentions thus far?
Despite this speculation, analysts in Johannesburg argue that there is still room for change in the MTN equation. As it happens, the company’s chief executive, Rob Shuter, initiated an asset disposal plan which has already raised R14bn ($958m). Will this honey pot be enough to fund a gamble on Ethiopia?
Ethiopia instead of Angola?
As part of the liberalisation of the monopolised sector, a stake of at least 49% in the state-owned operator Ethio Telecom will also be made available to private investors.
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Shuter has never hidden his interest in the Ethiopian market, which encompasses 109 million people and has a mobile penetration rate reaching 44% (compared to 73.4% in Sudan and 101% in Kenya).
However, the South African executive has for some time demonstrated scepticism about the limits to the liberalisation of Ethiopia’s telecoms sector, focusing instead on Angola, another high-potential market described by MTN as having “a large population” and being “fairly affluent”.
The operator withdrew its bid from a public tender for Angola’s fourth mobile phone licence, which was granted in April 2019 to Telstar, a little-known company considered to be closely linked to public officials, although the award was eventually cancelled pending a new tender process.
Will MTN try to bid again or will this failed attempt push it in the direction of Addis Ababa? All bets are off.