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India's Essar signs binding agreements to sell Kenyan telecom business for USD 120mn [IntelliNews - Weekly Reports]
[September 02, 2014]

India's Essar signs binding agreements to sell Kenyan telecom business for USD 120mn [IntelliNews - Weekly Reports]


(IntelliNews - Weekly Reports Via Acquire Media NewsEdge) India's Essar Capital, which manages Essar Global Fund Limited (EGFL), said it has signed binding agreements with Kenya's two biggest mobile operators - Safaricom and Airtel – for the sale of its telecom business in Kenya for approximately USD 120mn. EGFL, through its portfolio company Essar Telecom Kenya Limited (ETKL), operates yuMobile, the country's third largest mobile services provider with 2.55mn subscribers. Under the deal, Nairobi-listed Safaricom, which is 40%-owned by Britain's Vodafone, will take over ETKL's network, IT and office infrastructure, while Airtel, part of India's Bharti Airtel, will acquire the company's subscribers.



Essar Capital, part of India's diversified conglomerate Essar, said the sale is part of EGFL's strategy of divesting its global telecommunications portfolio. The Communications Authority of Kenya approved the deal in March, subject to certain pre-conditions. The transaction still needs to be approved by the country's competition regulator. Essar Capital expects the transaction to conclude by the end of 2014.

According to the latest available data by the communications watchdog, Safaricom had a total of 21.6mn subscribers at end-March 2014, followed by Airtel with 5.3mn, yuMobile with 2.6mn, and Orange with 2.5mn. In terms of market shares by subscribers, Safaricom is the standout leader with 67.8%, followed by Airtel with 16.5%, yuMobile with 8.0% and Orange with 7.7%.


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