MTN funds expansion for Nigerian operations

The South African operator MTN is set to provide its Nigerian subsidiary with an investment of US$1 billion. MTN Nigeria is the largest operator in the country, which is Africa’s biggest mobile market.

"MTN Nigeria will spend US$1 billion capex on optimisation, building the fibre network, improving transmission capacity, building more base stations and substantially increasing the capacity of its network," according to MTN Nigeria spokeswoman Funmilayo Omogbenigun.

The drive to increase capacity comes in the face of growing competition in the Nigerian market; Etisalat Nigeria is set to overhaul both its 2G and 3G networks, having taken out loans worth US$650 million from eight local banks.

MTN began funding the build-out of its Nigerian network last year, tapping 17 banks for loans (15 Nigerian, 2 foreign) worth US$2.15 billion. At the end of 2010, MTN Nigeria has 38.7 million subscribers. Second and third place are occupied by Glo Mobile and Bharti Airtel with 19.6 million and 15.8 million respectively, while Etisalat comes in fourth place with 6.8 million.

Bharti, whose African operations were acquired from Zain last year, is a potential threat to MTN’s African dominance; by 2013, the operator hopes to have expanded its subscriber base in Africa to 100 million, and to be making US$5 billion in revenue from the continent annually.

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