Bharti Airtel in talks to buy Telkom Kenya: report
16 Jan 2019
Bharti Airtel is reported to be in talks to buy Telkom Kenya, the East African nation’s smallest telecoms operator, to expand its operations in the country, reports quoting industry sources said on Monday.
A deal will help the Sunil Mittal-led telco emerge stronger in the East African market and improve overall valuation of Airtel Africa in the run-up to its initial public offer (IPO), likely in May-June, people aware of the development said.
Airtel, currently Kenya’s second-biggest telecoms operator, after market leader Safaricom, plans to buy the stake that London-based Helios Investment, which owns a 60 per cent in Telkom Kenya, is looking to partly offload its stake in the African telecom company.
Telkom Kenya is the third-largest telco in Kenya with over 5 million users, behind market leader Safaricom with over 30 million. Airtel Kenya had 10 million-plus customers.
Helios is trying to cash out of the investment which it made in 2015, reports citing sources said.
The two companies had held merger talks last year, only to abandon it later. Telkom made the approach that time.
A deal, if arrived at, is expected to be completed by the end of this quarter, the sources said.
The sector regulator Communications Authority of Kenya said it was yet to be formally notified by the two operators of the latest attempt at a deal.
The latest deal overtures come in the aftermath of Airtel Africa recently raising $1.25 billion (about Rs9,200 crore) by placement of shares to six global investors, which will be followed by an Airtel Africa IPO, through which the telco plans to garner an additional $1.5-1.6 billion.
Telkom Kenya in planning an expansion and optimisation of its 4G and 3G network. The network roll-out will see to the improvement of mobile connectivity, boosting the quality of service to customers.
In addition to improving mobile connectivity, Telkom Kenya will also invest in its fibre-to-the-building (FTTB) network, which is set to improve the quality of service offered to enterprise and corporate customers. The focus will include investments into access, core, transmission and IT components; infrastructure that is crucial to further improving network reliability and accessibility.