MTN lower, despite the sale of its assets in Cyprus

JOHANNESBURG – Telecommunications giant MTN fell 1.66% on the JSE yesterday, despite the announcement by the group that it planned to unload its non-strategic assets as part of its plans to restructuring.

MTN dropped to R104.73, down from R106.68 on Friday as mobile phone provider announced that its subsidiary MTN Dubai had reached an agreement to sell 100% of MTN Cyprus to Monaco Telecom for around 4 , 1 billion MTN R said that the net sale of the product would be paid in advance in cash.

He said the deal would push MTN Cyprus nearly eight times its 2017 earnings before interest, taxes, depreciation.

The group stated that it had agreed to allow Monaco Telecom to use the MTN brand in Cyprus for up to three years in exchange for a commercial fee.

MTN Cyprus is the only operational activity of MTN in the EU.

The unit was acquired as part of the acquisition of the telecom holding company Investcom by MTN Group in May 2006 for an amount of 5.5 billion dollars (72.8 billion rand) in a cash and stock transaction. Footprint of Africa and Middle E Peter Takaendesa, portfolio manager at Mergence Investment Managers, said that MTN said earlier that it would review its investment portfolio and its operating countries in order to focus more time management on the key elements. "MTN Cyprus is therefore one of the non-core assets and the figures disclosed imply good valuation of assets." Cyprus is a relatively high-income country per capita, but the market is not enough important to make a significant contribution to the MTN group, "said Takaendesa

MTN said the Cypriot purchase, which would remain subject to various closing adjustments, would allow it said that it was He expected the transaction to be completed in the coming weeks as it did not meet any regulatory conditions for completion.

The accounting effects of the transaction would be communicated to shareholders with provisional results for 2018 expected to be released on August 8.

MTN Cyprus had 426,000 customers.

Takaendesa indicated that MTN would continue to dispose of its non-core activities and the proceeds of the divestments were likely to

"We have seen encouraging decisions of capital allocation from the new team of direction in the last year, "he said.

– BUSIN ESS REPORT