South Africa’s MTN to buy Nigeria’s Visafone -sources

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JOHANNESBURG/LAGOS – Africa’s largest telecoms operator MTN Group is in talks to buy Nigeria’s Visafone Communications to solidify its grip in South African firm’s most important , sources familiar with the discussions said on .

Wireless-network operator Visafone was set up eight years ago to deliver voice and broadband services through mobile and fixed telecom platforms after business tycoon Jim Ovia, who also founded Zenith Bank, acquired three operators.

“The deal is done. We’re almost putting ink to paper,” a source close to the deal said.

Another source said the talks would conclude “very soon”.[pro_ad_display_adzone id=”10″]

Both sources did say how much MTN would spend on the purchase and how big a stake in Visafone it would take up.

Visafone grew its subscriber base from 30,000 after the acquisitions in 2007, to 2.2 million at the end of 2014, data from the telecom’s regulator showed.

But fixed wireless operators with CDMA platforms most suited for broadband and data services have faced stiff from more established rivals such as India’s Bharti Airtel, Dubai-based Etisalat and MTN, hitting the industry’s average revenue per user (ARPU).

ARPU, a gauge of telecoms firms’ competitiveness as well as of consumer spending trends, has declined over the past three years to $5 from $8 as competition deepens.

MTN had nearly 60 million users in Nigeria in 2014, about 27 percent of its entire subscriber base across 22 countries.
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Africa’s most populous country is also the biggest contributor to MTN’s revenue, providing more than a third of overall turnover.

MTN shares were down 0.5 percent at 1109 GMT and are flat so far this year. (Reporting by Helen Nyambura-Mwaura and Chijioke Ohuocha; Editing by James Macharia)(Reuters)