MTN Ghana has announced by the end of this year, they will meet the legally required 25 per cent localization threshold.
When MTN was licensed in 2015 to build a 4G network, they were required to sell 35 per cent of the company to local owners.
In 2018 they launched an IPO (initial public offer) on the Ghana Stock Exchange to allow Ghanaians buy shares and enable MTN meet their localization requirement. But just about 10 per cent shares were sold via the IPO.
Subsequently, the local shareholding, including shares given to local staff has grown to 16.4 per cent, as reported by MTN Ghana CEO, Selorm Adadevoh at the third Annual General Meeting (AGM) of the company.
Meanwhile, as MTN was working on meeting the 35 per cent localization requirement, Vodafone also won a 4G compatible license in 2018 and on that occasion, the National Communications Authority (NCA) reduced the localization threshold to 25 per cent.
This, according to MTN means that the NCA had adjusted the localization requirement from 35 per cent to 25 per cent for all networks and that is what the company is now.
Selorm Adadevoh said MTN has a firm plan in place to ensure that by close of this year, they would have met the 25 per cent localization threshold.
Meanwhile, as of December 31, 2020, almost 85.4 per cent of ordinary shares in the company was still in the hands of the Investcom Consortium, while the next biggest shareholder was SSNIT with just 1.62 per cent.
Regarding localization, MTN is also required to sell out at least 30 per cent of its mobile money subsidiary, MobileMoney Limited to local owners, in accordance with the Payment Systems and Services Act, 2019 (Act 987).
Selorm Adadevoh however reported that the Bank of Ghana (BoG) has extended the deadline to meet this requirement, to 15th January 2022, adding that “We look forward to providing further updates on our progress in subsequent releases.”
He also touched on the issue of the significant market power (SMP), saying that since October 2020, MTN Ghana implemented the NCA’s directive to apply a 30% asymmetrical interconnect rate reduction for two years.
Implementing the 30% asymmetrical interconnect rate reduction means when MTN customers call people on other networks and MTN is charging interconnect rate from those other telcos, they have to reduce the fee by 30%. It was designed to make the small telcos competitive.
The MTN CEO said engagements and discussions with relevant stakeholders on the SMP implementation has resumed after they were briefly suspended due to December 2020, adding “we are optimistic that these discussions will result in a positive outcome for MTN Ghana and the long-term sustainability of the Ghana telecommunications industry.