MTN Group has announced that it has concluded of two important transactions in Ghana and Uganda that will help it realize some capital. Specifically, MTN disposed of its 49% equity holdings in Ghana Tower Interco B.V. (Ghana Interco) and Uganda Tower Interco B.V. (Uganda Interco) to AT Sher Netherlands Cooperatief U.A. ("ATC") for $523 million.
The transactions form part of the pan African telecommunications company's Asset Realisation Programme ("ARP") which was announced in March 2019 which aims to reduce debt, simplify its portfolio, reduce risk, improve returns and realize capital of at least R15 billion over three years.
Also as part of the ARP, MTN has confirmed that "the necessary processes have been finalized for the redemption of MTN Nigeria preference shares for a consideration to MTN of $315 million, which was received on 31 December 2019."
Previously, when speaking to iAfrikan, MTN had hinted that it could possibly be looking to sell its holding in New York Stock Exchange listed Jumia as soon as the lockout period expires.
"We announced our overall Asset Realisation Plan to target capital release of ZAR15bn over the next 3 years, and as part of that we said that we will look to monetise our investments in ecommerce assets over time," an MTN spokesperson said at the time.
As far as monetizing their investments in e-commerce assets goes as part of their ARP, it seems that is yet to be actioned. However, the company is very clear that Jumia does not form part of its long-term plans.
"There are no updates since MTN Group’s position was last communicated in the Q3 trading update. The post-IPO lock-up period has expired and Jumia remains an asset that is not long-term strategic to the Group, however, there are no firm plans in place at this stage to monetize the asset," wrote an MTN spokesperson in response to iAfrikan.
Although the company has not provided any reasons why they are yet to sell their equity holding in Jumia, one of the possible reasons is that with Jumia's share price has taken a significant knock since Citron Research released their report in 2019 alleging fraud at the company, the share price might not be at a level that MTN will realize any significant capital should they sell.Share this via: