By Gugu Lourie
MTN, which gets most of its more than R60 billion in revenues from mobile phone services, is betting big on ecommerce in Africa and the Middle East and has up its stake in Africa Internet Holdings (AIH).
The mobile phone operator said on Wednesday in its interim financial results that it has exercised its rights to increase its investment in AIH to 41% from 33, 3%. The Group continues to retain joint control over AIH.
The firm, which operates in Africa and the Middle East, didn’t disclose how much it spent to buy an additional stake in AIH. In 2013, MTN bought 33, 3% stake of AIH – a joint venture between Rocket Internet and Millicom International Cellular.
The aim is to develop online ventures across the fast-growing internet markets of Africa and the Middle East.
AIH leverages on MTN’s biggest footprint in Africa and the Middle East, and that of Millicom, which has operations in Chad, the DRC, and Ghana.
AIH’s network of companies include Jumia – Largest e-commerce mall in Africa, Zando – Shoe & Fashion Online, HelloFood – online platform to order food from popular restaurants, Jovago – Africa’s no.1 hotel booking portal, and Vendito – General classifieds platform in Africa, etc.
MTN has big plans for the ecommerce market in this regions, which are underserved or untapped by bigger players.
“The continued rollout of MTN Mobile Money and broader financial services remains a priority as well as developing our digital offering with our partner Rocket Internet AG through the investment in AIH and Middle East Internet Holdings S.A.R.L (MEIH),” MTN said.
“MTN is well positioned to tap into the digital space on the African continent and in the Middle East. The group’s Digital function aims to leverage our brand, customer base and distribution network to accelerate growth in e-commerce, financial services, media and entertainment and lifestyle services” It added that through its investments with Rocket Internet AG will “continue to rollout a range of e-commerce and lifestyle offerings with 128 operations across 30 markets”.
MTN is investing heavily in developing online ventures so that it can take advantage of opportunities in the digital space.
In that regard, MTN and Rocket Internet AG have also formed a joint venture, Middle East Internet Holdings (MEIH), to develop internet businesses in the Middle East. MTN and Rocket are equal partners with a 50% shareholding each.
The partnership with AIH presently deliver a range of internet services including e-commerce retailing, as well as market place, taxi, travel, classified and food delivery services.