The merger will boost the telecom’s customer base to 5.9 million
Kampala, Uganda | AGENCIES | India’s telecom firm, Bharti Airtel, has received regulatory approval to acquire Millicom International Cellular’s Rwanda unit, Tigo Rwanda.
The Sunil Mittal-led mobile carrier said on Jan 23 that it had received approval from the Rwanda Utilities Regulatory Authority (RURA) to acquire Millicom’s Rwanda subsidiary.
Last December, Bharti Airtel had inked a definitive pact with Millicom International under which Airtel Rwanda would buy 100% equity interest in Tigo Rwanda, and in turn, consolidate the Rwandan mobile market by putting Airtel as a strong No 2 carrier by revenue in the African country.
Millicom’s move to sale Rwanda’s operations was in line with its strategy to focus on providing advanced fixed and mobile data services in Latin America, which contribute 86 % of its revenue, according to Millicom’s website.
“The merger will result in the only negative Ebitda operating company joining 13 positive Ebitda operating companies in Africa,” Bharti Airtel said in a statement. Meaning, all 14 Airtel units in Africa will become Ebitda positive, going forward.
The Airtel-Tigo merged entity will have the largest customer base in Rwanda with 5.9 million subscribers. It will also have the largest sales and distribution network in Rwanda.
The combined networks of the two companies will serve customers with voice/data services, global roaming and mobile banking services, Bharti Airtel said, adding that subscribers will not be required to change their existing Tigo telephone numbers and existing Tigo cash services will not be affected.
Statistics released by RURA in Oct 2017 shows that Tigo had 40% market share of Rwanda’s total 8,675,826 active subscribers, compared to MTN’s 41 % while Airtel had 19 %.
Bharti Airtel has been performing well in Africa, having reported a profit of US$76 million in the December quarter compared with a loss of US$93 million a year earlier, helped by a surge in data traffic and Airtel Money transactions. Airtel’s Africa revenues too have grown 5.3% on-year to US$783 million in three months ended December.
Over the years, Bharti Airtel has been bolstering its market position to become a key player in the continent with in-country acquisitions.
In the past, it has acquired assets in Uganda (Warid Telecom) and Congo B (Warid), Kenya (yu Mobile) and consolidated operations in Ghana (Millicom).
In a recent interview to Economic Times, Bharti Enterprises Chairman Sunil Mittal said that the company would look at consolidation in countries like Kenya, Rwanda and Tanzania through mergers, acquisitions or both, even as the overall Africa business was turning a corner.