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Africa\u2019s largest telecom company has become embroiled in Iran\u2019s decision to shut down communications during this month\u2019s deadly crackdown on protests.<\/p>\n
Authorities ousted state mobile operator MTN Irancell\u2019s chief executive officer without informing MTN Group, the South African company that co-owns the mobile network, accusing him of taking too long to comply with shutdown orders, people familiar with the matter said.<\/p>\n
Alireza Rafiei took about two hours to block phone calls after being ordered to join a nationwide communications shutdown on January 8, said the people, who asked not to be identified, discussing a sensitive business matter. This led Irancell\u2019s state-backed majority shareholders, who have direct ties to the country\u2019s security forces, to replace him with military veteran Mohammad Hossein Soleimanian.<\/p>\n
Johannesburg-based MTN, a 49% owner of the Iranian mobile company, was blindsided by the move and is writing to the Irancell board to dispute the decision, the people said. The MTN board hasn\u2019t made contact with Rafiei, they added.\u00a0<\/strong><\/p>\n MTN declined to comment on the matter. Irancell did not respond to a request for comment.<\/p>\n ADVERTISEMENT<\/p>\n CONTINUE READING BELOW<\/p>\n<\/div>\n<\/div>\n The telecommunications shutdown has choked off information about some of the biggest demonstrations since the 1979 revolution, as people took to the streets to protest soaring inflation and government corruption. One UN expert estimated this week that at least 5 000 civilians have been killed by government forces. The internet blockade, now in its third week, has cut off more than 90 million people from the outside world.<\/p>\n MTN went into business in Iran in 2006, signing a deal with the theocracy underpinned by the Islamic Revolutionary Guard Corps to be co-owners of what\u2019s now the country\u2019s second-largest mobile operator. MTN has been trying to sell the asset since 2020, though US sanctions and restrictions on moving money in and out of the country have made an exit impossible. What was once a lucrative foothold in a large emerging market has become what MTN CEO Ralph Mupita last year described as a \u201cfrozen asset,\u201d with the company\u2019s name now mired by its role in facilitating censorship.<\/p>\n While the government has direct control over some parts of the internet infrastructure, it needed Irancell\u2019s compliance to switch off the domestic mobile network, the people said.<\/p>\n In a note that was sent to state-owned media outlets and seen by Bloomberg, Irancell\u2019s local shareholders said that Rafiei had been moved to a different role within the holding company.<\/p>\n ADVERTISEMENT:<\/p>\n CONTINUE READING BELOW<\/p>\n<\/div>\n<\/div>\n MTN hasn\u2019t extracted capital or dividends from Iran since US sanctions were reimposed in 2018, it said in July. The company doesn\u2019t report its earnings from Iran, but analysts have estimated that hundreds of millions of dollars are stuck in the country. Irancell has approximately 70 million active SIMs, according to the most recent data from Iran\u2019s telecom regulator \u2014 about 42% market share.<\/p>\n \u201cIran remains a difficult investment for MTN and if there was a viable exit mechanism I think they would have exited,\u201d said Peter Takaendesa, chief investment officer at Mergence Investment Managers.<\/p>\n MTN\u2019s involvement in Iran has brought a wave of reputational damage. Turkcell Iletisim Hizmetleri AS, which previously owned the stake in Irancell, has alleged MTN paid bribes to obtain its local license in litigation that\u2019s been dragging on for years. MTN denies the allegations. The US Department of Justice also opened a case against MTN that is looking into whether its operations in Iran violate US sanctions and anti-terrorism laws, although MTN has not been charged with an offense.<\/p>\n The wireless carrier has been more successful in shedding other difficult markets in the broader region, including Afghanistan and Syria.<\/p>\n \u00a9 2026 Bloomberg<\/p>\n Follow Moneyweb\u2019s in-depth finance and business news on WhatsApp here.<\/em><\/p>\n<\/p><\/div>\n