Nigeria: Is MTN Group set to buy Visafone?

MTN Group has been extremely active over the past few years… especially when in comes to acquisitions in Africa. This time around, the MTN Group has now set its sight’s on Jim Ovia’s Nigerian mobile phone company, Visafone Communications. Ovia’s mobile phone company was essentially set up in 2007, and is currently delivering voice and broadband services through mobile and fixed telecom platforms. While the deal has not been made public as yet, sources closest to the deal who wish to remain anonymous – according to Bloomberg – stated that they were unable to give the value of the transaction. According to the report, MTN has been exploring acquisitions as it seeks to boost revenue from data outside South Africa, where Vodacom Group has more subscribers. MTN had 59.9 million subscribers in Nigeria at the end of 2014, more than a quarter of its 223 million total across 22 countries. Visafone had about 2.2 million customers as of December, according to data compiled by the Nigerian Communications Commission. Funmilayo Onajide, a spokeswoman for MTN Nigeria said they will send a holding statement at the appropriate time. According to Moneyweb.co.za: “The deal is done. We’re almost putting ink to paper.” According to Forbes, Visafone founder Jim Ovia, 61, is one of Nigeria’s wealthiest men with a fortune estimated at $850 million. He founded Zenith Bank in May 1990 and grew it into one of the largest commercial banks in Africa with a market capitalization of more than $3.5 billion. He served as CEO of the bank from its inception till 2010 when he stepped down. Apart from his interests in telecoms and banking, Ovia is also constructing a 5-star hotel in Lagos and a $1.5 billion petrochemical plant in Nigeria’s South-South region.According to various reports, the acquisition will enable MTN to leverage Visafone’s value proposition, and expand its offerings and services to their Nigerian customers. To add to this Visafone is the only network provider with a CDMA network in Nigeria. The CDMA network is less congested and could enable MTN to offer higher quality services.

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