05 March 2010
	New set of challenges By Larry Claasen

MTN Group CEO and president Phuthuma Nhleko is leaving the company in a year but there is already speculation over who will replace him. The board, chaired by Cyril Ramaphosa, will have a difficult job replacing someone who was at the helm when the group's share price rose from less than R13 in 2002 to its current level of R113. Naming a successor is some way off but the challenges facing the new CEO are very different from the ones Nhleko had to deal with when he took over eight years ago, says Kaplan Equity Analysts MD Irnest Kaplan. When Nhleko took charge, MTN's main objective was expanding from SA. Now that it is in 21 countries, the CEO needs a different set of skills from Nhleko's deal-making abilities. Under him, the group took over Investcom, a mobile operator in the Middle East, and also took a 49% holding in Iranian operator Irancell. "As its markets mature, the focus will change to protecting market share," says Kaplan. The group will still do takeovers but the person taking over from Nhleko will have to able to deal with telecom regulators - which have become increasingly stringent - and increased competition. The problems facing the CEO are not unlike the problems MTN is experiencing in its SA operation: the market is mature, and its margins are under pressure from the regulator, which wants it to drop prices. So who has the skills to lead a multinational mobile operator in a maturing market? If MTN had to follow rival Vodacom's playbook when it replaced its CEO with its chief operating officer, Sifiso Dabengwa would be next in line for the job. Dabengwa joined MTN in 1999 and was MD of MTN SA, then MTN Nigeria, before taking his current job. Other strong internal candidates could be the MD of its Southeast Africa region, Tim Lowry, head of business risk Shauket Fakie, and former Investcom CEO Azmi Mikati. Whoever the board taps for the job will have big shoes to fill. Nhleko fell short of closing MTN's deal with India's Bharti Airtel last year but he leaves an impressive legacy.