Safaricom group taps Sh55bn loan for Ethiopia entry
Monday December 21 2020
By VICTOR JUMA
Summary
Safaricom and its parent companies Vodafone Group Plc and Vodacom Group Limited have formed a joint venture – Global Partnership for Ethiopia through which they are bidding for one of two telecommunications licences being auctioned in that country.
The financial investment in Ethiopia is expected to top the $1 billion (Sh111 billion) mark, with the DFC loan deal seen as part of the project’s fundraising efforts.
Safaricom had earlier said it was ready to take more debt in its role as the majority shareholder of the consortium with a 51 percent stake.
“Our strategy is very simple,” Mr Tamalgo said. The company plans to leverage its position as the main vendor of the state-owned monopoly Ethio Telecom to bid for opportunities in the country, he said.
Liberalisation of the telecom industry is at the forefront of what Ethiopian Prime Minister Abiy Ahmed said in 2018 would be a wide-ranging privatisation program. The plan was intended to bring in much needed foreign exchange and boost the economy, while improving connectivity across the Horn of Africa nation.
The country is seeking to double its mobile towers to about 14,000, which would require an investment of up to $1.1 billion, and build out its fibre-optic network from less than 30,000 km currently, according to the Ethiopian Communications Authority. It also plans to sell a 40 per cent stake in Ethio Telecom and issue two new telecom licenses next year.
Huawei Planning to Move Regional Office from DRC to Ethiopia
Huawei Technologies Corp. seeks to get more business in Ethiopia and is likely to move its regional office from the Democratic Republic Congo (DRC) to Ethiopia, where it currently has a country office. Huawei s move is aimed at Ethiopia s economy opening up its telecommunications sector, Bloomberg reported.
“Ethiopia is rising and becoming much more important for the future,” Loise Tamalgo, Huawei’s head of public relations for 22 countries in sub-Saharan Africa, said in an interview in Ivory Coast’s commercial capital, Abidjan.
“Our strategy is very simple,” Tamalgo said. The company plans to leverage its position as the main vendor of the state-owned monopoly Ethio Telecom to bid for opportunities in the country, he said.
US backs Vodafone-led bid for Ethiopia licence with $500m Sign in with LinkedIn
15 December 2020 | Alan Burkitt-Gray A US government agency is supporting Vodafone’s consortium that is bidding for one of Ethiopia’s two new telecoms licences with a loan of US$500 million.
The money comes from the International Development Finance Corporation (IFC), based in Washington DC, which earlier this week spent $300 million on Africa Data Centres though that was an investment, not a loan.
Ethiopia is most of the way through liberalising its telecoms market, which until now has been a monopoly in the hands of state-owned Ethio Telecom.
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The US International Development Finance Corporation (DFC) loaned up to half a billion dollars to a consortium of companies led by Vodafone to create a new operator to enter the Ethiopian market.
In a statement, the government arm said the $500 million will fund the “design, development, and operation of a new private mobile network provider” and the acquisition of a mobile network provider license in Ethiopia.