Vodafone-Essar buys controlling stake in Dhabi’s African operations
16 Nov 2009
The Essar Group has sealed a deal agreed to buy a majority stake in the Emirates-based Dhabi Group's telecommunication businesses in Uganda and Congo, the Indian energy-to-steel conglomerate said in a statement on Sunday.
Essar said Dhabi's telecom assets, Warid Telecom Uganda and Warid Congo SA, had an enterprise value of $318 million, but did not say how much it was paying for the stake.
The Indian group already offers mobile services in Kenya under the 'yu' brand through its unit, Essar Telecom Kenya.
The Ruia family-owned Essar Group is Vodafone's partner in India's third largest mobile firm, Vodafone Essar. It holds a 33 per cent stake in Vodafone Essar and a stake of less than 10 per cent in Loop Mobile, another Indian telecom firm.
The Dhabi Group's telecom operations in Africa are routed through Warid Telecom and their assets in that continent, include operations in Uganda and Congo. The Essar Group said the enterprise valuation of Warid Telecom's African operations was valued at $318 million, but did not divulge the extent of stake it has picked up.
''The Essar Group has committed growth capital to both telecom operations to facilitate network expansion and marketing. Upon completion, the Essar Group will acquire a majority stake in both the assets. The partnership is also expected to bring operational efficiencies to the African operations,'' the company said in a statement.
The deal with Warid will serve to boost the Essar Group's telecom portfolio of disparate telecom assets scattered around the world, giving it a firmer foothold in booming African markets. Teledensity, or the number of phones per 100 people, in Uganda is only about 30 per cent, while in Congo it is around 20 per cent.
