Just like Nigeria, the authorities in Uganda have asked MTN’s group in Uganda to list some of its shares on the local stock exchange, Uganda Securities Exchange (USE) as a condition for renewing its operating license that is set to expire in October.
Godfrey Mutabazi, Head of Ugandan Communication Commission (UCC) told Reuters that Ugandans should be able to own a stake in MTN Uganda which has been in operation for 20 years in the country.
“We are evaluating the conditions of the license renewal and that is one of the points we are discussing.” Mutabazi said referring to a possible listing on USE. In addition, when he was asked if the condition was a prerequisite for prolonging MTN’s license, he replied saying it was right.
“The firm had not shown any resentment to that proposal”, Mutabazi added.
The firm has dominated the market in Uganda throughout its two decades in the East African country. It is the largest telecommunications firm by subscribers, followed by a unit of India’s Bharti Airtel and other smaller players.
The listing of MTN’s shares would cause a boost to the local stock exchange which is still quite small, with 16 firms as of July 2014. The local stock exchange had not attracted an Initial Public Offering (IPO) in Six years since its last IPO of Umeme (UMEM), a power distribution company on the USE in 2012 until this month when a local drugs maker was listed on the exchange.
“MTN is an investor here and they have been here for 20 years…to go beyond, I would argue that they have been here long enough they should be identified as Ugandans and the only way to do that is to list so that Ugandans can have a stake in that company,” Mutabazi said.
“They should warm to the government desire to have some of their shares listed.” Mutabazi concluded.
Recently, MTN Uganda has faced criticism on social media platforms like Twitter and Facebook from some subscribers about data bundles getting used up quickly, does not download music and the firm not responding to their complaints.
In May UCC said it would investigate MTN after criticism on social media about its mobile money policies. Mobile Money is a cell phone-borne service popular in Uganda and across East Africa that allows individuals to transmit cash between themselves and also quickly pay for goods and services.
An extra headache for MTN and other telecoms in the country is also coming from a new tax measure on access to use of popular social media platforms like Facebook and WhatsApp which some analysts think will hurt growth in the sector.
As part of the conditions of relinquishing part of MTN’s $5.2 billion fine, the company is expected to list on the Nigerian Stock Exchange. The Securities and Exchange Commission said recently it is awaiting the papers of MTN.
According to the group’s financial results in 2017, MTN Uganda has a subscriber base of 10.7 million. Its revenues for the year also surged by 10 percent to $356.34 million.
