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MTN cashes in BIG TIME on Mascom

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  • Mascom pays MTN P721m
  • Mascom shareholders paid around P1.4bn in 2018
  • BPOPF paid around P545m
  • Strive Masiyiwa’s Econet paid over P953m

KEABETSWE NEWEL

Leading telecommunications operator Mascom Wireless Botswana (Pty) paid out a staggering R962 million (an equivalent of P721 million) to South African shareholder, MTN SA as a dividend for the year ending 31st December 2018, the MTN annual report reveals.

Amongst Mascom shareholders, MTN is the largest beneficiary in terms of dividends.

During the twelve months ending 31st December 2018, MTN made R134 billion (P100.5 billion) in revenue from its operations exceeding 24 countries internationally. Botswana is amongst the 24 countries. In those 24 countries, 3 are joint ventures, where MTN is in partnership with the respective countries’ investors. In terms of revenue, MTN makes most of its money in South Africa and Nigeria where, R44.6 billion and R37.9 billion were made respectively.

Amongst the three Joint Ventures, MTN is present in Botswana (through Mascom), Iran and eSwatini. In Iran, revenue made was R11.6 billion. Revenue from Botswana’s Mascom was R962 million (around P721 million) while eSwatini contributed R359 million. Mascom pays MTN dividends annually. MTN would then account for the money as part of revenue from all its operations.

MTN, the South African mobile phone giant with operations internationally, has 53 percent shareholding in Mascom. The P721 million paid to MTN during the period under review, was paid as a dividend for the 53 percent shares in Mascom. Calculations further reveal that if the P721 million paid to MTN was a dividend for the company 53 percent stake, it would mean then that for the remaining 47 percent stake Mascom would have paid around P640 million as dividend.

The Botswana Public Officers Pension Fund (BPOPF) has 40 percent stake while Econet owns 7 percent shares. In terms of calculations, BPOPF may have been paid around P545 million as dividend for its 40 percent while Econet pocketed around P95 million. Econet’s shareholding in Mascom is owned by Strive Masiyiwa in partnership with local businessman, Kagiso Mmusi.
Moreover, Mascom is one of MTN’s cash cows when it comes to Average Revenue per User (ARPU). The term ARPU means the money in revenue, generated from one subscriber in a certain period of time.

The MTN annual report reveals that MTN makes more money per user on average in Botswana, South Africa and Swaziland.

MTN’s total number of subscribers is 236 399 000 in all its operations. The highest numbers of subscribers are in Nigeria with 60.5 million, followed by South Africa with 30 million. Mascom subscribers in Botswana are 1.8 million.

Further Mascom, here in Botswana, has the leading market share at 51.4 percent. Mascom is currently subjected to boardroom wars. MTN sealed a deal with Strive Masiyiwa’s Econet in November 2018 for Econet to buy MTN’s 53 percent at P3billion. It emerged that in that process, BPOPF, the second largest after MTN, was not informed of the deal, and allowed its pre-emptive rights of refusal. BPOPF then blocked the sale, and sought permission from regulator, Non Bank Financial Institutions Regulatory Authority (NBFIRA) to hike its stake up to about 73 percent. As it stands, MTN will not be selling to Econet anytime soon.

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