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MTN South Africa Cost Cuts to Affect 847 Managers, Union Says

MTN Group Ltd. (MTN), Africa’s largest wireless operator, may cut as much as 14 percent of its staff in South Africa to address declining market share and revenue, according to the Solidarity union.

MTN wrote to employees in its domestic market on Aug. 22 to say that 847 managers will be affected by plans to cut spending, Solidarity spokesman Marius Croucamp said by phone today. The Johannesburg-based company employs 6,196 people in South Africa, according to the union.

“MTN SA will continue to review its cost structures, including employee costs, to ensure better alignment with revenue performance,” Themba Nyathi, MTN South Africa’s chief human resource officer, said in an e-mailed response to questions. “MTN SA has begun a process of internal staff consultations on a proposed organizational restructuring.” The company declined to comment on the number of jobs that would be affected.

MTN has overhauled senior management in its fastest growing markets as it seeks to increase smartphone penetration and boost data revenue outside South Africa, where sales are under pressure from competitors and regulators. The Independent Communications Authority of South Africa reduced the amount MTN can charge smaller operators to use its network earlier this year, affecting revenue.

MTN’s market share in South Africa declined 2.7 percentage points to 31.9 percent in the six months through June. The company operates in 22 countries in Africa and the Middle East, including Syria and Iran.

To contact the reporter on this story: Christopher Spillane in Johannesburg at cspillane3@bloomberg.net

To contact the editors responsible for this story: Kenneth Wong at kwong11@bloomberg.net John Bowker

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