MTN has announced it plans to dispose of its 50.02% shareholding in Afrihost.
The move is part of MTN’s “strategy of focussing on core business and pursuing opportunities in relevant adjacent businesses”.
“The transaction is still subject to regulatory clearances and Competition Commission approval,” said MTN.
MTN bought its shareholding in Afrihost in 2014 for R408 million.
“Evolving market circumstances have resulted in MTN reviewing its ownership in Afrihost. As a result, MTN has agreed to dispose of its shareholding to the executive management of Afrihost.”
Afrihost came under fire for poor DSL network performance following its deal with MTN, which led the ISP to create its own network and move away from MTN as its upstream supplier.
“Our decision to create our own network is not based on MTN’s network or a breakdown in service or our relationship,” said Afrihost in 2015.
MTN “agreed and supported” the move, said the ISP.
Rumours of Afrihost’s directors making an offer to MTN to buy back its 50% stakesurfaced in May, with a source telling MyBroadband that discussions were at an advanced stage.
“We have enjoyed a long and fruitful partnership with MTN over the years and we are grateful for everything they have done for us. MTN will remain a key supplier of ours, and we look forward to continue working with them for the years ahead,” said Gian Visser, Afrihost’s CEO.
The “spirit” of the sale means MTN expects this development to have minimal impact on its customers.