(Bloomberg) — MTN Group Ltd. is set to complete the sale and leaseback of South African towers by the end of next month, while a separation of both the fintech and fiber units is also underway as the wireless carrier strives to pay down debt.
The tower deal could generate as much as 11 billion rand ($747 million), according to analysis by Bloomberg Intelligence. The fintech move is due to be finalized by March and fiber over the next two years, the Johannesburg-based firm said in a statement on Thursday.
“We have received binding bids for our South African towers,” Chief Executive Officer Ralph Mupita said on a conference call later.
Africa’s biggest mobile-phone company is more than two years into a transformational breakup project, shedding assets and exiting markets to focus on core businesses around the continent. A key aspect is to cease operations in the Middle East, and MTN has abandoned its Syrian business as regulatory demands prevented a more orthodox exit, the group said. It’s weighing options to exit Yemen and Afghanistan, Mupita said.
The shares rose as much as 6.2% in Johannesburg and were 3.4% higher as of 4:09 p.m. local time. MTN has gained 98% this year, among the best performances in the benchmark FTSE/JSE Africa All Share Index and boosting its market capitalization closer to those of Kenyan peer Safaricom Plc and cross-town rival Vodacom Group Ltd.
MTN confirmed it is not going to resubmit a bid for a new license in Ethiopia, which is opening up the market to international operators for the first time. Bloomberg News reported the decision earlier this month. A previous offer by the carrier and various partners was rejected by the government.
Sales grew by 2.1% in the six months through June, while earnings before interest, taxes, depreciation and amortization rose by 6.6%. The group outperformed in its home market of South Africa, where revenue gained 12%.
The carrier cut debt to 36.7 billion rand from about 43.3 billion rand. MTN has repatriated 7 billion rand this year from Nigeria, where it has historically been hard to extract cash due to a lack of foreign exchange.
(Updates with CEO comment on tower sales, latest share price)
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