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Safaricom to Transit Into a Holding Company

Safaricom announced its plan to transition into a holding company that will be an umbrella of its other telecoms businesses, the M Pesa mobile money business, and the Ethiopian Unit as its subsidiary.



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Safaricom, the second biggest telecommunication company in Africa, announced its plan to transition into a holding company that will be an umbrella of its other telecoms businesses, the M Pesa mobile money business, and the Ethiopian Unit as its subsidiary.

Speaking on the company’s transition plan, Peter Ndegwa, the Chief Executive Officer (CEO) of Safaricom,
said the company plans to establish a solid group structure, which would allow Safaricom to access diverse businesses.

He said the major reason Safaricom has been successful in its relationship with its consumers over the years
is because mobile money is part of the GSM business, so the rumored claims of splitting M-Pesa from Safaricom
is not happening anytime soon.

He said, “Although we (Safaricom and M-Pesa) work in separate teams – the actual M-Pesa team is very different – however, they rely on the network that the GSM side has to provide. They rely on the distribution network.”

M Pesa mobile money was launched by Safaricom in 2007 as a mobile money payment transfer service with over 51 million M-PESA users.

Safaricom after its transitioning as a holding company plans to accommodate other businesses in the nearest future, including Digi Farm, a new tower company.

African companies transitioning into holding firms seems to be the new normal as it gives them access to diverse businesses, opportunity to expand revenue generation and broaden growth while offering quality service.

MTN, Africa’s biggest mobile phone network provider transitioned into a holding company, MTN Group in march 2021.

MTN has since ventured into a series of businesses from Payment Service Bank (PSB) called MoMo to agent banking and e-commerce.

Since its launch a few months ago, MoMo has garnered over 56 million users, according to the telecommunications giant.

However, there seems to be fierce competition between the two leading telecoms in Africa on which of them has the top mobile money service in Africa.

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MTN Nigeria to Convene Extraordinary General Meeting to Address Capital Loss



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MTN Nigeria, one of the country’s leading telecommunications giants, has announced plans to hold an Extraordinary General Meeting (EGM) with its shareholders to deliberate on strategies for managing the significant capital loss it incurred in 2023.

The decision was disclosed in a corporate notice filed with the Nigerian Exchange Limited on Tuesday and the EGM is scheduled to take place later this month in Lagos.

The primary agenda of the meeting will be to discuss and explore possible measures to mitigate the loss of capital suffered by the company during the financial year ended December 2023.

The telecom giant posted a net loss after tax of N137 billion, largely driven by a N740 billion foreign exchange loss.

Consequently, MTN Nigeria’s retained earnings and shareholders’ fund plummeted to negative N208 billion and N40.8 billion, respectively.

In a statement, Karl Toriola, the Chief Executive Officer of MTN Nigeria, acknowledged the daunting operating environment characterized by inflationary pressures, currency devaluation, and foreign exchange shortages.

Toriola explained that the adverse impact of these factors on the company’s financial performance necessitates a comprehensive reassessment of strategies to navigate the complexities ahead.

Toriola further expressed the company’s commitment to sustaining commercial momentum and accelerating service revenue growth, despite the challenging economic landscape.

The decision not to declare a final dividend for 2023 reflects MTN Nigeria’s prudent approach to prioritizing financial stability and long-term resilience amid ongoing uncertainties.

The upcoming EGM signifies a pivotal moment for the company and its shareholders to collaboratively chart a course towards recovery and sustainable growth.

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NCC Files Copyright Infringement Charges Against MTN Nigeria and Others



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The Nigerian Copyright Commission (NCC) has taken legal action against MTN Nigeria Communications Ltd. and four individuals, including its Chief Executive Officer, Karl Toriola, over alleged copyright infringement.

The charges, filed in the Federal High Court, Abuja Division, revolve around the unauthorized use of musical works belonging to artist Maleke Idowu Moye.

According to the NCC, the defendants are accused of offering for sale, selling, and trading musical works of Maleke without his consent between 2010 and 2017. These works were allegedly used as Caller Ring Back Tunes without proper authorization.

The musical pieces in question include popular tracks such as “911,” “Minimini-wanawana,” and “Stop racism,” among others.

The commission further alleges that the defendants distributed these musical works to subscribers without authorization, infringing upon the rights of the artist.

The charges are based on provisions of the Copyright Act, Cap. C28, Laws of the Federation of Nigeria, 2004.

As the case awaits assignment to a judge and a fixed date for mention, it marks a significant development in the ongoing efforts to uphold copyright protection in Nigeria’s telecommunications sector.

This legal action underscores the NCC’s commitment to safeguarding the intellectual property rights of artists and creators within the country.

MTN Nigeria, a major player in the telecommunications industry, now faces a legal battle that could have broader implications for how intellectual property rights are respected and enforced within Nigeria’s digital landscape.

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MTN’s MoMo Sees 32.2% Surge in Transaction Volumes



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MTN Group’s mobile money platform, MoMo, has experienced a 32.2% surge in transaction volumes.

With 72.5 million active users, MoMo continues to solidify its position as a leading fintech service provider in Africa, tapping into the continent’s burgeoning mobile banking sector.

The company’s success underscores the growing trend of Africa’s young and tech-savvy population embracing mobile technology to address financial needs.

Mobile phones are increasingly becoming a tool for bridging gaps in services, particularly in banking, presenting a lucrative opportunity for wireless carriers like MTN to capitalize on the burgeoning fintech market.

MTN’s achievement comes as it finalizes a deal with Mastercard Inc., valuing its fintech business at an impressive $5.2 billion.

This strategic partnership further enhances MTN’s position in the digital finance space, positioning it for continued growth and innovation.

However, MTN is not alone in its fintech endeavors. Rivals such as Airtel Africa Plc, Safaricom Plc, and Vodacom Group Ltd. are also making strides in digital transformation, with plans to separate and monetize their fintech businesses in the long term.

Airtel Africa, for instance, is reportedly considering an IPO for its mobile money unit, indicating the high stakes and intense competition within the sector.

Despite the remarkable success in its fintech ventures, MTN faced challenges in its core telecommunications business, with service revenue growth slowing to 6.8%.

Inflation and currency devaluation in key markets, particularly Nigeria, impacted profitability, highlighting the complexities of operating in diverse African markets.

As MTN continues to expand its fintech footprint and invest in infrastructure to enhance connectivity across the continent, it remains poised to capitalize on the immense potential of Africa’s digital economy.

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