MTN Group has restated it was still pushing to sell its 75 per cent stake in its subsidiary in Syria, despite the unit being placed under judicial guardianship over alleged violations by the South Africa-based operator.
The company agreed a $65 million deal with technology company TeleInvest, which owns the other 25 per cent stake in the Syrian business, as part of a wider strategy to exit the Middle Eastern market in the medium term.
However, the deal faces a threat after MTN Syria was placed under guardianship by a Damascus court last week, with claims MTN violated terms of a licensing contract, resulting in a loss of revenue for the government.
A representative told Reuters MTN was still committed to “executing on the agreed transaction with TeleInvest”.
The chairman of TeleInvest has been placed in charge of the day-to-day running of operations by the court until the issue is resolved. The court has not indicated how long the guardianship order will remain in place.
It is the latest of several issues MTN faced in the Middle East over the years, including a bribery scandal in Iran and allegations it aided militant groups in Afghanistan.
In 2020, MTN said it wanted to exit the Middle East and focus on its pan-African strategy, with its operations in the former accounting for less than 4 per cent of EBITDA in H1 2020.
As well as Syria, MTN owns operations in Yemen, Afghanistan and Iran.