MTN said on Monday that it has agreed to invest $300 million in the Iranian fixed broadband provider Iranian Net and lend the company $450 million, according to local technology news agency CITNA.
Rob Shuter, CEO of MTN, signed the agreement in Tehran with Telecoms Minister Mahmoud Vaezi after months of discussion about the company entering the fixed-line Internet market.
The long-awaited investment will give the South African firm a 49% stake in the company.
After the signing ceremony, Vaezi said, “Iranian Net has been endeavoring to attract foreign investment to launch the fiber optic to home services.”
“TCI has launched a similar project recently. With MTN-Iranian Net entering the sphere, people will have a chance to choose between the two.”
MTN expects to invest $300 million in the form of equity and an additional $450 million in loans to help Iranian Net meet its roll-out targets over the next five years.
“The preliminary agreement is subject to finalizing suitable transaction agreements,” MTN said in a press release to South African media.
“Iranian Net has a national license for the construction and operation of an optical data transmission network and fiber-optic access network across Iran,” it added.
“This investment, should it be completed, represents an opportunity to capitalize on the continued strong growth expected in the Iranian broadband market, with an initial focus on eight of the main cities.”
MTN is already a big investor in Iran, holding 49% of MTN Irancell, the second largest mobile operator in the country.
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