Outgoing MTN Group CEO Phuthuma Nhleko has scotched persistent rumours that the telecommunications operator plans to relocate its head office to the Middle East, saying its domicile will always be SA.

Market talk has persisted in the past two years that MTN wants to move its headquarters to Dubai, where it already has a large office of network engineering, human resources personnel and other support staff serving countries in the region.

MTN operates networks in countries such as Iran, Syria and Afghanistan, which can be more easily served from an office located in the Middle East.

The group’s decision to create a new structure, with MTN International holding its interests outside SA, has prompted some market commentators to question whether it has plans to relocate the group’s main office to Dubai.

However, Nhleko describes the rumours as nonsense. “This is not about domicile,” he says. “That is not even a debate.”

Rather, he says, it’s about placing staff in regions from where it makes sense to serve the 21 territories in Africa and the Middle East in which the group operates.

MTN International, which is still being formed, will “probably” be based in SA, Nhleko says. It will report into MTN Group, with the group’s senior management ultimately calling the shots.

“MTN Group, as far as we are concerned, will forever reside [in SA]. And we will expand throughout the world from here,” he says.

He says creating a new international structure is important because it “caters for the broadness” of the group. “Also, you have to ensure you continue growing those operations and get more. You can’t ignore the 75% growing part of your body as it continues to spread. You need to ensure your balance sheet is efficient, your funds are in the right places, and you need to optimise your capital structure.”

MTN will remain listed in SA, though a dual listing on an international bourse is an option, Nhleko says. “We must always find ways of unlocking value for shareholders. One way of doing that may involve MTN International being listed itself, but we are not saying that’s what we want to do. It’s one of the permutations the board will consider.”

He says a foreign listing is not under active discussion by the group’s board. — Duncan McLeod, TechCentral