Via Techrasa, some commentary on MTN’s operations in Iran:

After becoming the second largest Mobile Network Operator in Iran, MTN now wants to invest in e-commerce in the country.

MTN has been working in Iran since 2005 with its 49% share in Irancell, the second largest Mobile Network Operator in the country. Since then with the help of its partner’s expertise, Rocket Internet, they have been launching new startups in the e-commerce sector, namely snapp, Bamilo, Eskano, Mozando(merged with Bamilo) and Pintapin. In the past couple of months something has changed and this company has publicly announced that it will invest in other sectors such as e-commerce in Iran. Now, Reuters reported that MTN has set aside $700M in capital expenditure to revamp its network and invest in the rapidly growing e-commerce sector in Iran where it has already invested $22 million in their startups in Iran including Snapp. “While our presence in Iran’s e-commerce space is still relatively nascent, it is growing rapidly, particularly in the retail and travel sectors. We’re very excited about Iran and the possibilities there,” MTN’s newly appointed head of strategy, mergers and acquisitions, Stephen van Coller, told Reuters in an interview.

MTN had been helpless to repatriate its accumulated dividends until recently due to the sanctions. It was just in October that the company has started receiving its profit from Iran and it’s said that this process would take at least six months. With U.S. President-elect Donald Trump, MTN’s risk could be even bigger than before. Reuters went further and asked the question if Trump’s win could deter or impact further investment in Iran, “That’s a tough question, I don’t know really,” Coller answered. “As those restraints (sanctions) get lifted you will see that economy grow really quickly. It’s almost like South Africa in 1994 in a way.”

But expanding Iran’s operations in other sector has brought doubts to one of the shareholders, Abax Investments, which holds less than one percent of the shares. “A country with a list of potential business risks even longer than Nigeria,” Anthony Sedgwick told Reuters to describe Iran. “The valuation any normal conservative investor will place on the profit stream will come with a big discount.”

In Recent years MTN has been considered as the biggest corporate successes of the post-apartheid era in South Africa but in recent years with limited growth outlook. MTN’s shares also dropped by 20% in the past year showing the company is struggling with making profit. But with this recent $700M investment and the talks for investing in Iran’s national fiber internet project maybe there is way out for MTN after all.