South Africa-based MTN Group has announced a new four-year strategic plan called ‘Ambition 2025’. This will see the carrier focusing only on regional African dominance and exiting other markets (it quit the Middle East last year), while also spinning off other assets such as fiber and financial services businesses into standalone units.
MTN is the largest operator in Africa with 280m subscribers, and the ninth largest in the world. It operates in 21 countries although 40% of its revenues come from Nigeria.
It plans to invest US$1.9bn in its networks and other technology platforms this year, while reducing debt via the spin-offs and divestments – it aims to raise $1.68bn in this way. Group CEO Ralph Mupita said: “As part of this strategic repositioning, we are looking to structurally separate our infrastructure assets and platforms to reveal value and attract third party capital and partnerships into these businesses, over the medium term.
One of the carve-outs will be of MTN’s financial division, whose flagship service is the
Mobile Money service (MoMo), which supports payments via electronic wallets on handsets, with no need for a bank account. That has 46.4m users across 15 African countries, up from 34.6m a year ago, and MTN expects the service to have 100m users by 2025, challenging the similar mPesa service from Vodafone. It currently contributes 8% of group revenue, and that is targeted to reach 20% in 2025.
Mupita said: “If we were a bank, we would be a very big bank. We see a separation and carve-out of our fintech business as something that we have to do.”
MTN told TelecomTV that its future strategy rests on five digital platforms, including Ayoba, an end-to-end encrypted peer-to-peer instant messaging platform, which is available in 17 MTN markets, promising high security and privacy. The others are MoMo, Chenosis (a pan-African API marketplace and library for developers), and an Enterprise Customer Platform and Network-as-a-Service platform for companies across the region.