Airtel Networks Kenya Unit to Merge with Telkom Kenya

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The two companies will combine their respective mobile, enterprise and carrier services businesses in Kenya to operate as Airtel-Telkom

India’s Bharti Airtel said its unit Airtel Networks Kenya has signed an agreement with Telkom Kenya, the East African nation’s smallest telecom operator, to merge operations.

The merger will help the Sunil Mittal-led telco emerge stronger in the east African market and improve overall valuation in the runup to its initial public offer (IPO) in Africa, likely in May-June, ET reported.

The two companies will combine their respective mobile, enterprise and carrier services businesses in Kenya (subject to approval) to operate as Airtel-Telkom, the report said.

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The deal will not involve Telkom Kenya’s extensive real estate holdings and some government contracts for unspecified services, according to an NDTV report.

No timeframe has been given for the deal, and both companies will operate as normal until the transaction is completed. Airtel also didn’t reveal any financial details of the deal.

About Telkom Kenya

Telkom Kenya is 60 per cent owned by UK private equity firm Helios Investment Partners and the rest by the Kenyan government.

It’s the third-largest telco in that country, with over 5 million users, behind market leader Safaricom with over 30 million and Airtel Kenya, with over 10 million customers.

The combined entity will have over 31 per cent customer market share, compared with Safaricom’s 60 per cent -plus. As of September, Airtel Kenya voice and mobile data traffic shares were 33.3 per cent and 21.9 per cent, respectively.

Telkom’s chief executive Mugo Kibati will become the chairman of the new company, while Prasanta Sarma, the chief executive of Airtel Kenya, will hold the same role in the combined entity, Telkom said.

 

 

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