What NCC’s transfer of Visafone licence and frequencies mean for MTN

The transfer of the licence and frequencies of Visafone Communications Limited to the new owner and digital mobile operator, MTN Nigeria Communications Limited is been processed by the Nigerian Communication Commission (NCC).  According to Punch, a public forum with respect to this will be organized by NCC in Abuja next week.

Visafone was set up 11 years ago by one of Africa’s richest men Jim Ovia. It grew its subscriber base to 2.2 million at the end of 2014 from the 30,000 which it ended within its first year but according to data from NCC Visafone’s internet subscriber base as of April 2018 stands at 30,305. It is the only surviving Code Division Multiple Access (CDMA) network in Nigeria’s telecommunications industry and received 12 licences from NCC in 2011.

What this means for MTN

This licence will further increase MTN’s position as the leading telecommunication company in Nigeria. This is because MTN  will now leverage on Visafone’s operations, brand and network infrastructure. The transfer of frequencies will also help improve both the voice and data platforms of Visafone.

Visafone was the only Nigerian telecoms operator to have an 800 MHz spectrum licence, which it won in 2007. The broadband licence was said to be MTN’s major interest in the acquisition deal.  With this MTN will be able to further expand its fourth-generation Long Term Evolution (4G LTE) service.

Why Jim Ovia sold Visafone

It all started in 2015 when the news broke that Jim Ovia who was then one of Africa’s richest men was planning to sell his telecommunication company Visafone for an undisclosed amount and MTN had emerged the preferred bidder.

According to reports, despite being the most suited for broadband and data services, CDMA technology platforms have faced stiff competition from rivals which includes MTN, Airtel, Glo, Etisalat, Swift Nigeria, Smile, and Spectranet. The business was also capital intensive as it was eating deeply into the finances of the telecommunications company thereby making the company owe its sister company Zenith bank over N345 million.