MTN Nigeria has officially liquidated Visafone, bringing the country’s last-standing CDMA network to an end as the telecoms giant records a huge financial loss from the acquisition.
Per TechCabal, a note in MTN’s H1 2024 financial statement revealed the liquidation was completed during the period, and all remaining assets and liabilities of Visafone have been transferred to MTN.
MTN Nigeria had acquired Visafone from Jim Ovia in 2016 with the aim of improving broadband internet services. Central to this strategy was Visafone’s 800MHz spectrum licenses, which MTN hoped would enhance its 4G LTE offerings.
However, the acquisition proved more complicated than expected, primarily due to regulatory issues.
For three years, MTN faced opposition from competitors such as Airtel and 9mobile, who argued that the acquisition would give MTN an unfair advantage, increasing its stake in the available spectrum from 38% to 50%.
The Nigerian Communications Commission (NCC) was initially hesitant to approve the transfer of the spectrum licenses, leading MTN to consider withdrawing from the deal. However, the need to compete with Globacom, which had launched 4G LTE services in October 2016, kept the acquisition on track.
In the end, MTN invested a total of ₦43 billion in the acquisition of Visafone, but the process concluded in a ₦30.3 billion ($18 million) loss, as stated in the company’s latest financial reports.
The carefully thought importance of the Visafone acquisition, given its 2.2 million registered subscribers at the time and the prospects to bolster MTN’s broadband capabilities was huge.
MTN’s interest in expanding its spectrum holdings is not new as the telecom giant had previously acquired VGC Communications Limited (VGCCL) in 2006 for $70 million (₦9.3 billion), further pointing to its drive to enhance service offerings by securing additional spectrum licenses.
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