MTN 'Not Takeover Target'
 25th OCT 2006

Sub-Saharan Africa's biggest cellular operator MTN has not received any takeover approaches recently, a top executive has said,  shrugging off talk MTN may become a target as rich Middle Eastern firms expand on the continent. Chief Technical Officer Karel Pienaar, a board member at the South Africa-based company, said he was not aware of any negotiations regarding a takeover of MTN, which runs networks in 23 countries in Africa and the Middle East.

"A potential takeover is really a shareholder issue," Pienaar told a telecoms conference in Cape Town when asked if MTN had received any approaches from possible buyers. "I am not aware of any of that happening at this stage. Certainly there has been some activity in the past but not recently." Some analysts say MTN could become a target for cash-rich Middle Eastern operators hungry for growth, or even private equity players, although some say potential buyers will wait until MTN has integrated recently acquired Dubai-based Investcom and launched a risky new investment in Iran. MTN said last year it was in takeover talks, sparking speculation a European operator might be keen to snap it up. But the talks collapsed.

MTN Chief Executive Phuthuma Nhleko has repeatedly said that with a market value of $16.4bn, the company is "nobody's lunch". Operators from South Africa, Europe and the Middle East have been scrambling to gain a foothold in some of the world's last untapped mobile markets in recent years, sparking a wave of acquisitions in Africa and sending asset prices soaring. Despite a flurry of deals, some 115 companies still operate on the continent, leaving plenty more room for consolidation, say analysts and executives. Some analysts and executives say that with buyers paying more than $1 000 per subscriber, and given that growth is starting to slow, multiples for African assets are simply too high.  

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