MTN calls in big guns to ease woes
Fresh from taking a hit on regulatory matters in Nigeria, MTN has insured itself with a contingent of political heavyweights on its reconstituted board and newly established advisory board as it pursues further growth.
On Friday, Africa's largest telecommunications provider by subscriber numbers announced former deputy finance minister Mcebisi Jonas as its chairman designate to replace Phuthuma Nhleko from December 15. Nhleko will first oversee a transition of the board as well as the establishment of an international advisory board.
The advisory board will be chaired by former president Thabo Mbeki and will include John Kufuor, the former president of Ghana.
Further changes at MTN board level include the appointment of Sanusi Lamido Sanusi, a former governor of the Central Bank of Nigeria, and Vincent Rague, a Kenyan who has held senior positions at the International Finance Corporation in a career spanning more than two decades.
The board overhaul is largely on the back of shareholders calling for an independent chairman to improve corporate governance. Nhleko, who was previously MTN CEO and is credited with the group's rapid expansion in the early 2000s, returned in 2015 as executive chairman to resolve regulatory issues.
Dobek Pater, a director at Africa Analysis, said the appointment of political heavyweights with a financial background indicated "a strong focus on finance and trying to increase the value of the company".
It also showed MTN was paying greater attention to trends in the political, regulatory and compliance spheres across the African and Middle Eastern markets in which it operates, Pater said.
Mbeki's strength is considered to lie in building relationships across Africa.
Sanusi's appointment comes as MTN prepares to list on the Nigerian stock exchange.
The listing is a condition of a $1bn regulatory settlement three years ago. This was after MTN failed to disconnect unregistered subscribers by a deadline.
Last year, Nigerian authorities accused MTN of illegally repatriating over R8bn from Nigeria. It also faces a $2bn penalty for alleged tax evasion in the country.
Peter Takaendesa, portfolio manager at Mergence Investment Managers, said Sanusi's appointment may "help with stakeholder relations" in Nigeria.
Jonas's political clout and respect for good governance may stand MTN in good stead.
Bright Khumalo, portfolio manager at Vestact, said: "He's got big shoes to fill. He is there to make sure that everyone is accountable for what they do and Mcebisi is the right man for the job."