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MTN confident of fair resolution of marketing partner dispute
MTN says it remains neutral in the fight over its marketing contract but is optimistic of a fair resolution. Photo / File
What you need to know:
- Three agencies including M&C Saatchi, CTA Space and Creatabuzz Communications are pulling ropes over who handles MTN Uganda's marketing budget effective, January 1, 2025
MTN Uganda has indicated that whereas it remains neutral and fully supports the appropriate legal and internal processes pursued in the ongoing dispute between M&C Saatchi and CTA Space over its local marketing partner contract, it is confident that a fair resolution will be reached.
In a statement signed by Ms Rhona Arinaitwe, the MTN senior manager communications and stakeholder management, the telecom said M&C Saatchi, which was in April appointed the MTN Group marketing partner “is handling the matter, and MTN trusts they will resolve it appropriately”.
“MTN remains neutral and fully supports the appropriate legal and internal process, confident that a fair resolution will be reached,” the statement, emailed to Monitor, reads in part noting that MTN was aware that CTA had engaged legal counsel and reported the issue as a procurement irregularity through MTN Group’s whistleblower system, a process the telecom respects and expects any necessary investigation to be conducted thoroughly.
In April, MTN Group appointed M&C Saatchi Abel as its new marketing partner across all operating companies, effective January 25, 2025.
Before the appointment, M&C Saatchi had held preliminary discussions with CTA, before it signed a memorandum of understanding in September 2023, in which it confirmed it as its local marketing agency affiliate in Uganda that would handle the MTN account.
However, in its statement, MTN indicated that M&C Saatchi further reviewed CTA Space’s suitability, but “deemed not to be the best fit for MTN Uganda, and recommended another agency for the Ugandan market, a decision MTN accepted”.
MTN also noted that it had “no formal dealings, legal obligations, or relationships with CTA Space, its owners, or directors, and had no basis for direct engagement with them”, in a routine procedure that is conducted every three years by the MTN Group through which the telecom appoints marketing agency partners for all MTN operating companies in 21 markets in Africa and the Middle East.
On Monday, Monitor published an article, which detailed a bitter fight over MTN Uganda’s multi-billion shilling marketing contract involving M&C Saatchi and Creatabuzz on one side and CTA Space on the other.
The dispute, which started late in June is threatening to develop into a full-blown legal battle, with CTA Space warning that if it is not the agency that is contracted to handle the MTN Uganda marketing budget, it should be compensated close to Shs2b, failure of which it will file a lawsuit on grounds of being deprived of “rightful gain”.
It is understood that after CTA Space was dropped as the MTN local marketing agency, M&C Saatchi presented Creatabuzz as the new marketing agency to MTN.
Last week, Mr Twaha Kakaire, the CTA Space managing director, said if the contract is signed with MTN and it is not CTA Space doing the job in question against the appointment notice made to CTA Space, without compensation for incurred costs and business loss, then a lawsuit shall be filed against M&C Saatchi and everyone involved, on grounds of using their dominant positions to “deprive CTA Space of its rightful gain”.
