Naspers Ltd the parent company of Multichoice Africa is considering the sale of DSTV, its Pay-TV business in Africa to MTN, as slow economic expansion in key markets stifles growth and viewers switch to cheaper online alternatives.
According to sources familiar with the matter, the disposal of MultiChoice Africa is being linked to the shrinking revenue of the company in Nigeria as well as the emergence of other viable online options for watching programmes without necessarily patronizing DSTV.
As Naspers charges customers in local currencies, the continued weakness of currencies and economies in many African countries resulted in lower U.S. dollar revenues, accordingly to the company.
Nigeria’s economy contracted for the first time in 25 years in 2016 and its currency has depreciated by 37 percent against the dollar over the past 12 months.
It was learnt that MTN Group Ltd, Africa’s largest wireless operator, have briefly discussed a deal for MultiChoice Africa with Naspers Ltd, but no agreement was reached, a source privy to the deal said.
If the deal goes through, MTN will emerge as both a telecommunication as well as an entertainment company that will be able to deliver TV content and render video-on-demand services on smartphones through its vast network across the globe.
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