Mobile Telephone Network (MTN) has expanded into Nigeria via MTN Nigeria Communication Ltd., as part of the company’s US$1.14 billion planned spending spree over the next 10 years.
MTN Nigeria Communications Ltd., is the local affiliate of MTN South Africa and recently won a bid to offer telephone services in Nigeria. MTN Nigeria followed news that it expects to be profitable by the end of the fiscal year that wraps up in March 2004 with word of its spending plan.
The investment in Nigeria, part of a continent-wide effort, will affect more than 10 million telephone customers in the next decade, said Rob Nisbert, MTN’s finance director. Although he did not provide specific figures, he said that forecasts show Africa’s largest market is a well worth the $285 million MTN Nigeria spent for a telecommunications license.
Both the parent company and its local affiliates are optimistic about growth in Nigeria and believe that the country represents 20 percent of the African telecommunications market, although that sector remains vastly untapped.
At a news conference in Johannesburg after the Nigerian auction ended recently, MTN executives said that the company expects 30 percent of its overall corporate earnings over the next few years to be derived outside of South Africa, where the market is saturated.
Despite high expectations within the company, the stock market wasn’t so receptive, with MTN shares dropping sharply after the news conference.
