MTN Group, which has US$1bn stuck in Iran, agreed to invest the equivalent of R315m in Snapp.ir, the Islamic Republic’s first taxi-hailing smartphone application.
The funds “will allow us to quickly expand to other cities” than Tehran, Snapp CEO Shahram Shahkar said by e-mail on Tuesday. Johannesburg-based MTN will transfer the cash to the app’s owner, Iran Internet Group, which operates and invests in start-up and e-commerce companies.
MTN’s investment in Snapp strengthens the phone company’s ties with Iran as it tries to repatriate R15,4bn from the country following the lifting of US-led economic sanctions.
MTN’s former chief financial officer, Brett Goschen, said in August that it will take at least five months for the carrier to transfer the money due to a lack of ties between Iran and international banks.
MTN has invested in tech start-ups in Africa and the Middle East through the Middle Eastern Internet Group and Africa Internet Holdings. Both of those ventures are in partnership with Germany’s Rocket Internet, which isn’t involved in MTN’s investments in Iran.
MTN is a 49% stakeholder in a joint venture with Iran’s second biggest telecommunications provider, IranCell. That’s one of the South African company’s 22 markets across Africa and the Middle East.
Iran Internet Group owns e-commerce companies including Snapp, retailer Bamilo and food delivery service ZoodFood. The taxi-hailing service has gained about 500 000 subscribers and a fleet of 10 000 drivers since it started two years ago as Iran’s answer to Uber Technologies, according to Shahkar.
The CEO declined to provide figures for Snapp’s revenue and profit, saying the company’s focus was on reinvesting to expand the business into other cities. — (c) 2016 Bloomberg LP
