MTN Battles Protests in Carrier's Two Biggest African Markets

(Bloomberg) -- MTN Group Ltd. is grappling with worker protests in two of the mobile-phone company’s biggest markets as labor groups fight for more unionization in Nigeria and higher wages in South Africa.

The continent’s largest wireless carrier by subscribers re-opened Nigerian offices Friday that were closed for much of the week due to violent protests. MTN has been in talks with the country’s telecommunications regulator, government and industry groups to resolve the disagreement, which relates to employees’ ability to join unions, the Johannesburg-based company said in an emailed response to questions.

In South Africa, the Communications Workers Union sent MTN notice of a first strike in three years after negotiations broke down over salary increases. About 120 protesters gathered outside the company’s Johannesburg headquarters, according to an MTN spokeswoman, who said operations were largely unaffected.

MTN shares were little changed at 106.98 rand as of 3:26 p.m. in Johannesburg, valuing the company at 202 billion rand ($15.8 billion). The stock is down almost 22 percent this year, compared with a 14 percent drop at crosstown rival Vodacom Group Ltd.

‘Troubled Relationship’

Nigeria is MTN’s biggest market with more than 52 million customers as of end 2017, but the carrier has had a troubled relationship with Africa’s most populous country in recent years. In 2015, the company was hit with a regulatory fine that led to more than 18 months of negotiations that eroded the share price. Last year, MTN Nigeria’s headquarters in the capital, Abuja, were vandalized in retaliation for xenophobic attacks on Nigerians in South Africa.

Staff were assaulted and properties vandalized during the latest demonstrations, which relate to union allegations that MTN is refusing to allow workers to be asked whether they want to join a labor union. The company rejected the claim, saying none of its workers took part in the protest.

MTN has 29.5 million subscribers in South Africa, trailing only Nigeria and Iran among its largest markets. Overall, the company has more than 220 million customers across 22 countries.

--With assistance from Tope Alake.

To contact the reporters on this story: Loni Prinsloo in Johannesburg at lprinsloo3@bloomberg.net;Yinka Ibukun in Lagos at yibukun@bloomberg.net

To contact the editors responsible for this story: Alastair Reed at areed12@bloomberg.net, John Bowker, John Viljoen

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