How much MTN really paid for Afrihost

Mergers, Acquisitions and Financial Results

MTN has disclosed for the first time how much it paid to acquire Afrihost, and it's not as high as earlier reports suggested.

The mobile operator said on Wednesday in its annual financial results that it shelled out R408m to acquire 50% (plus one share) of the Internet service provider. A large portion of the value of the deal was made up of goodwill.

At the time of the deal, reports elsewhere incorrectly pegged the valuation attached to Afrihost at R1bn, well more than the implied R816m based on the value of the deal.

Afrihost has been incorporated under MTN's newly centralised enterprise business unit, now headed by former Microsoft South Africa MD Mteto Nyati. The acquisition was concluded in November 2014.

"This, as well as future acquisitions in this space, will be important in supporting our ambitions in this area,” MTN told shareholders on Wednesday.

"Our enterprise business unit is well placed to becoming the ICT partner of choice to corporate and small and medium enteprises, public sector and financial services customers, given our extensive infrastructure with 22 established operations and 47 data centres across Africa and the Middle East,” it said.

"Control over Afrihost will enable the group to drive its accelerated SME strategy and provide scale for the group's virtual market, content and cloud offering.”

Source: Techcentral 4 March 2015