In a surprise development, JSE-listed telecommunications group MTN has announced it will not form a subsidiary board for its international operations — at least not yet. The group had planned to establish a separate board for its international operations, to be chaired by former CEO Phuthuma Nhleko, to manage its interests outside SA.
The decision not to formulate a board for the international business follows a review of work completed by a subcommittee of the group board appointed to investigate the matter, MTN said in a terse statement issued on Wednesday. It provided no reasons for the decision.
It had been speculated that MTN International, which would have had its own CEO, would have created two centres of power in the group, one centred in Dubai, where it’s understood MTN International would have been headquartered, and one in SA, where the group head office is located.
The decision not to formulate an international board may been seen by investors as a move by new CEO Sifiso Dabengwa to stamp his authority on the emerging markets telecoms group.
Nhleko, who stepped down as CEO at the end of March, has also stood down from the group board and is no longer involved in MTN in any way.
Meanwhile, MTN on Wednesday said it had signed up ts 150 millionth subscriber. Speaking at the group’s annual general meeting, Dabengwa said MTN had increased its subscriber base by 7,4m, or 5%, to 149m by the end of April and that it had subsequently passed the 150m across the 21 countries in the Middle East and Africa in which it operates.
“Margins in the majority of MTN’s key markets in Africa and the Middle East remained robust, although margin pressure in markets with high levels of price competition was experienced,” Dabengwa said.
“Robust margins were primarily due to the benefit of ongoing cost control and efficiency initiatives, despite the negative impact of inflationary pressures and higher fuel costs.”
He said MTN was “in good stead to take advantage of value-creating opportunities, while mitigating the various risks. MTN will continue to leverage its scale, operational capability and intellectual capacity in an industry which has become more competitive as it matures and evolves.” — Staff reporter, TechCentral
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