MTN Group CEO Ralph Mupita (pictured) raised the possibility of the operator making an improved bid to enter Ethiopia in a second round of applications, but warned without the ability to offer mobile money services it would probably abandon efforts completely.
Speaking at the company’s Capital Markets Day weeks after the failure of its first attempt [1] to win a licence from Ethiopian authorities, Mupita reiterated his belief the opportunity in the market was significant.
However, he noted without the ability to launch its mobile money services it “probably wouldn’t even bid” in any second round of applications.
A rival consortium led by Safaricom and its Vodafone Group affiliates won a licence in the original tender, though figures revealed by the Financial Times claimed it lodged a significantly higher bid. The successful party reportedly offered $850 million compared to MTN’s $600 million.
Discussing the failed first bid, Mupita said MTN assessed the financial framework and adjusted its offer based on a lack of access to mobile money and a ban on international tower companies being able to build the infrastructure.
The executive noted its options of either doing a “self build” of tower infrastructure or signing a rental agreement with incumbent Ethio Telecom payable in US dollars limited the price.
He added: “In the second round, if there is mobile money we will bid again. If the licence conditions in the second round remain the same there’s no reason to bid any higher.”
“We are not about flag planting, trying to conquer the [African] continent by putting in flags, we need the finance, strategy and risk profile to make sense.”
After only allocating one of two possible licences in the original tender, Ethiopian authorities have yet to formally announce if or when another round of applications will be opened to give out a second.
[1] https://www.mobileworldlive.com/featured-content/home-banner/vodafone-safaricom-beat-mtn-to-ethiopia-licence
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