MTN Ghana has been awarded spectrum worth R3.4bn by Ghana's National Communications Authority. The spectrum, allocated in the 700MHz and 3GHz bands, will be used to provide 5G and mobile broadband services. This development is significant for MTN Ghana, its second-largest market by earnings. The award follows the government's decision to revoke the exclusive wholesale 5G rights of Next Gen InfraCo, a state-backed provider.
The awarded spectrum includes two 20MHz lots in the 700MHz band and three 50MHz lots in the 3GHz band. MTN Ghana will pay $100.9m and $101.1m respectively for the lots. The spectrum licences have a validity period of 15 years. MTN Ghana is currently finalising the required formalities and payment obligations associated with the licence acquisition. The payments have been incorporated into the company's equity free cash flow outlook.
The acquisition of the spectrum licences will enable MTN Ghana to strengthen its network capacity, enhance service quality, and improve customer experience across Ghana. The company plans to deploy the 5G spectrum in addition to its existing spectrum stock. This development is expected to drive growth in 5G mobility and help MTN Ghana achieve its aspirations to connect homes in Ghana.
MTN Ghana recently reported a strong operational and financial performance, crossing 32-million subscribers. The company's service revenue increased 32.3% to 15-billion cedis in the six months to end-June. This growth was driven by sustained demand for data services, increasing adoption of digital financial services, and higher engagement across digital platforms.
The company's earnings before interest, tax, depreciation, and amortisation (ebitda) increased 39.8% to 9.3-billion cedis. Profit after tax also increased 43.3% to 5.1-billion cedis. MTN Ghana attributed its strong performance to improved macroeconomic conditions. The company will keep investors and the broader market informed about its rollout plans and use of the spectrum.
Rival Telecel was awarded three lots in the 2.3GHz band. The government's decision to revoke Next Gen InfraCo's exclusive wholesale 5G rights was due to the company's failure to launch services by a June deadline. MTN Ghana's spectrum award is a significant development in the country's telecommunications sector.
MTN Ghana will use the spectrum to improve its services and drive growth in 5G mobility. The company has a strong track record of providing quality services to its subscribers. With the awarded spectrum, MTN Ghana is well-positioned to continue its growth trajectory and expand its presence in the Ghanaian market.
Key points
- MTN Ghana awarded R3.4bn spectrum for 5G and mobile broadband services
- Spectrum licences valid for 15 years
- MTN Ghana's strong financial performance driven by demand for data services and digital financial services
