MTN Group is believed to have struck a deal with Brightstar Corp, a US based distributor of mobile phones and other devices, to outsource its retail outlets in South Africa.<\/p>\n
This is according to Bloomberg, who reported that as many as 800 jobs could be affected, citing a person familiar with the matter.<\/p>\n
Brightstar would take on the management of MTN’s chain of retail stores, “and may take on some of the MTN staff” Bloomberg said, adding that the Miami-based firm would also operate most of the mobile operator’s local distribution and logistics operations.<\/p>\n
MTN\u2019s South Africa unit has struggled amid an increase in competition and a 36% decline in interconnect revenue due to lower mobile termination rates (MTRs), the group noted in its most recent financial report.<\/p>\n
Earlier in March, MTN reported a 3.9% drop in local revenue for the year ended December 2014, to R38.9 billion, while earnings before interest, tax, depreciation and amortisation (EBITDA) slipped to R12.5 billion, from R14 billion before.<\/p>\n
In August last year, MTN notified union, Solidarity, of its intention to implement a restructuring process that would affect up to 847 managers.<\/p>\n
The union later noted that most of its affected members accepted voluntary retrenchment packages, while some were placed in alternative positions at MTN.<\/p>\n
In a recent interview with BusinessTech, MTN South Africa CEO Ahmad Farroukh said that the group had completed its retrenchment process.<\/p>\n
MTN did not respond to BusinessTech by the time of publication, while Brightstar referred Bloomberg’s queries to MTN.<\/p>\n
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