MICHAEL AVERY | MTN’s Irancell chessboard has been overturned

With the flames of conflict arcing across the Middle East after the death of Ayatollah Ali Khamenei in a blaze of airstrikes that shook the Persian night — and the oil markets before they even opened — nobody can say for certain what the outcome might be.

As Daniel Yergin has spent a lifetime arguing, oil is the wiring of the international system. And as historian Niall Ferguson reminds us, in a world of great-power rivalry the decisive constraint is bandwidth. Seen through those lenses, Operation Epic Fury is as much about China as it is Iran’s disruptive role in the Middle East. And, in a smaller but increasingly uncomfortable way, it is also about South Africa.

For three decades the Islamic Republic endured because it sat astride the Strait of Hormuz, the narrow channel through which a fifth of the world’s oil flows. A moment’s hesitation there becomes a movement in Brent and, through it, the inflation rate of every importing economy.

But the deeper shift of the Khamenei era was the redirection of energy flows from west to east. China now buys the overwhelming majority of Iran’s sanctioned exports, carried on ghost fleets that relabel cargoes somewhere between Bandar Abbas and the Malacca Strait.

This is the “new map” Yergin describes, the shift of the energy centre of gravity from the Atlantic to Asia. China has not supported Iran out of revolutionary solidarity. It supported it because a dependent Iran is a strategic asset as a discounted supplier, a corridor into the Gulf and a permanent drain on American military attention.

That relationship extends from oil to infrastructure and surveillance, binding Tehran into a wider Chinese strategic system. From Washington, the equation is simply that every ship and missile tied down by Iran in the Middle East is one not available for the Pacific. All of which brings us, improbably but unavoidably, to Pretoria.

While it remains debatable that the ANC’s relationship with Tehran is an inheritance from the struggle, a relic of the solidarities of 1979 and 1989, the cost is no longer in question. Washington has already terminated aid and is openly linking the future of trade preferences to Pretoria’s diplomatic alignments.

While it remains debatable that the ANC’s relationship with Tehran is an inheritance from the struggle, a relic of the solidarities of 1979 and 1989, the cost is no longer in question.

This is not a moral argument about the Middle East. RW Johnson has long written about the ANC’s difficulty in distinguishing between the romance of the liberation movement and the realities of governing a modern state. The Iran relationship is a textbook case. It delivers no measurable economic benefit. It generates measurable diplomatic and financial risk. And at precisely the moment when global blocs are hardening, it places South Africa on the wrong side of the most important strategic competition of the century.

There is also the story of what now happens to MTN’s 49% minority stake in MTN-Irancell. Control of the remaining 51% sits with the Iran Electronic Development Company (IEDC), whose own shareholding is split between two powerful institutions: Iran Electronics Industries (known as Sairan), which falls under the ministry of defence & armed forces logistics, and Bonyad Mostazafan, the vast post-revolutionary conglomerate that occupies a unique legal category in Iran, neither state nor private, and reports directly to the office of the supreme leader.

Both apex figures are now dead, and the command structure behind the controlling 51% of Iran’s largest digital network has been cut away in a single night.

For MTN, the immediate implication that there is no longer a functioning partner on the other side of the shareholder agreement raises questions of how it could exit. Even before the latest strikes, CEO Ralph Mupita characterised the Iranian investment as a “frozen asset”, one where funds could neither be injected nor repatriated.

Both apex figures are now dead, and the command structure behind the controlling 51% of Iran’s largest digital network has been cut away in a single night.

Any disposal of such an asset would require an authorised and legally recognised counterparty able to approve a transfer of shares. The constitutional process for appointing a new supreme leader, which rests with the assembly of experts, is entering uncharted territory, not least because the recent strikes also eliminated numerous senior figures in the political and Revolutionary Guard hierarchy.

Though Ali Larijani, widely seen as a preferred successor, has issued statements promising retaliation, he has no formal power over the Bonyad’s commercial interests until a new supreme leader is officially installed.

The legal risks facing MTN are intensifying in both scope and immediacy. In August 2025 the group confirmed that it had become the subject of a US justice department grand jury probe examining its activities in Afghanistan, as well as its shareholding in Irancell.

At the same time it continues to fight claims brought under the US Anti-Terrorism Act by relatives of more than 500 American service members killed or wounded in Iraq and Afghanistan. Their argument is that MTN’s involvement in Irancell channelled substantial financial benefit to the Revolutionary Guard.

Adding to this litigation burden is a separate $4.2bn action from long-time competitor Turkcell, which maintains that the original Iranian licence was secured through corrupt payments to officials in both Tehran and Pretoria.

The period under scrutiny in Iran and Afghanistan coincides with Cyril Ramaphosa’s tenure as MTN chair. His successor, Mcebisi Jonas, now serves as special presidential envoy after his disastrous mission to Washington last year.

What has changed is the context in which these cases will now be judged. Until this week the US investigation dealt largely with past conduct tied to a legacy investment. It must now contend with a scenario in which a subsidiary of a JSE-listed company is in effect under the operational command of a Revolutionary Guard figure and is being used to shut down communications while American forces are engaged in active hostilities against Iran.

Given that Operation Epic Fury was, by Israeli accounts, prepared over many months, the intelligence compiled in advance is likely to include a granular reconstruction of Revolutionary Guard funding channels, including those moving through corporate structures such as MTN-Irancell.

The civil suits in the US are similarly recast. Plaintiffs have long asserted that MTN’s Iranian venture amounted to material assistance to the Revolutionary Guard. The events of February 28 hand them a far more immediate and compelling narrative, which doesn’t look good for MTN.

At a broader level, it’s almost impossible to say with any certainty just how the death of Khamenei will reshape Iran. It may weaken the regime, strengthen the Revolutionary Guard or bind the country even more tightly into China’s economic orbit. But for South Africa, the immediate lesson is closer to home.

Pretoria has an opportunity, if it grasps that the geopolitical ground has shifted, to bury revolutionary romance, reach out to new US ambassador Brent Bozell and strike a deal that could unlock investment and help catalyse growth at precisely the moment the country most needs it.

• Avery, a financial journalist and broadcaster, produces BDTV’s ‘Business Watch’. Contact him at michael@fmr.co.za.