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South Africa’s MTN Group Ltd says its planned exit from Iran has been stalled due to United States sanctions, effectively freezing its multibillion-rand investment in the Middle Eastern country.
“You cannot take money in, and you cannot take money out,” Chief Executive Officer Ralph Mupita told reporters at a briefing in Johannesburg on Friday. “Our strategy has been a full exit from the Middle East.”
MTN currently holds a minority stake in Irancell, an entity over which it has no operational control. The company has already wound down other Middle Eastern assets, including its sale of operations in Afghanistan early last year.
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The telecoms giant is also under scrutiny by the US Department of Justice, which has convened a grand jury to probe MTN’s conduct in Afghanistan and Iran. Mupita stressed that no financial provisions have been made, noting that the probe does not currently involve monetary claims.
“There is no claim, so there is no provision or contingency,” he said.
In a statement issued on August 27, MTN reaffirmed that it was “respectfully defending cases brought against it” in the US, while maintaining that “the plaintiffs have sued the wrong defendants in the wrong courts.”
MTN, which operates in 16 markets across Africa and the Middle East, continues to face pressure to refocus on its home continent. South Africa remains its largest single market but contributes less than a third of total group revenue.
Mupita noted that South Africa’s telecom sector is ripe for consolidation, particularly in infrastructure. He pointed to the Competition Commission’s recent approval of Vodacom Group Ltd’s acquisition of Remgro Ltd’s fibre assets as a “major inflection point” for the industry.
Adding to the speculation about MTN’s local strategy, Bloomberg reported on Thursday that the company is considering reviving talks to acquire rival Telkom SA. Such a deal, if successful, could reshape South Africa’s telecoms landscape, giving MTN greater scale in both mobile and fixed-line services.
For now, however, the group’s exit from Iran remains out of reach, with US sanctions leaving its investment in the country as what Mupita described as “a frozen asset.”
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