Government says it will acquire Malawi Telecommunications Limited (MTL) to merge it with the Digital Broadcasting Network Limited as major shareholder Press Corporation (PCL) plc plans to sell the company.
Formally State-owned, MTL was privatised in 2005 in a transaction that saw PCL owning a controlling stake of 52.7 percent with government owning the other part.
However, the company failed to compete in the sector, resulting in back to back losses for many years.
Ironically, government’s decision to buy back MTL appears to be a desperate move as PCL has for years put on sale its stake in MTL, but the business was not attractive to investors. Last week, the company cautioned its shareholders in a statement on promising negotiations regarding the sale.
Minister of Finance and Economic Affairs Simplex Chithyola Banda indicated in the 2025/26 Budget that the government is in the process of amalgamating ICT (Information and communications technology)- based institutions providing similar services.
He said: “Government is acquiring MTL, which will be merged with Malawi Digital Broadcasting Network Limited, Escom Optical Fiber Communication and Government Wide Area Network.
“This amalgamation will streamline operations, enhance service quality and optimize resource utilisation through building a more resilient and interconnected digital infrastructure, thereby ensuring that Malawi’s digital future is both robust and sustainable.”
In an interview, equity investment analyst at Stockbrokers Malawi Limited Kondwani Makwakwa described PCL’s decision as strategic, given that MTL has been facing financial difficulties, negatively impacting the group’s overall profitability.
“This shift is expected to improve financial efficiency, enhance shareholder value and reinforce the group’s long-term strategic focus,” he said.
In a separate interview, stock market investor and member of the Minority Shareholders Association of Listed Companies Joe Maere said selling MTL will be a huge relief to PCL as the business has weighed down performance of PCL for years, surviving in recent years on disposal of its physical assets.
Meanwhile, investment analyst Brian Kampanje said the sale of MTL could enable PCL clean up its balance sheet while giving the group an opportunity to invest in other high-value sectors using its proceeds.
In the cautionary statement, PCL said it is engaged in exclusive negotiations for the potential sale of its entire shareholding interest in MTL, being 52.7 percent of the total issued share capital of MTL, adding “the outcome of these negotiations may affect the share price of PCL”.
MTL was once a profit-making and competitive business with huge assets spread across the country, but its business nosedived after the coming of mobile phones almost completely replaced ground phones, a technology the business failed to adapt to compete with other market players.
