MTN Group, one of Africa’s largest telecommunications company says it has dropped out of the race for a telecom license in Ethiopia. Earlier this year, the company offered $600 million to the Ethiopian government but the officials rejected the offer for being too low.
The first license went to the Safaricom-led consortium which offered $850 million to enter Ethiopia’s telecommunications industry. The consortium, comprised of Safaricom, Vodafone, UK sovereign wealth fund CDC Group, and Japanese conglomerate Sumitomo Corporation is set to start operations in Ethiopia in early 2022.
MTN Group CEO Ralph Mupita told the media that the company’s board decided not to proceed with the bid after taking various risk criteria into account. According to the chief executive, it’s tough to compete as a third or fourth telecommunications license holder in any market.
The departure of MTN Group from the telecoms race is a big blow for Africa’s second-most populous nation.