Airtel,Telkom Kenya to merge mobile, enterprise

Written By: Brian Itava
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Airtel Kenya and Telkom Kenya have signed a binding agreement to merge their mobile, enterprise and carrier services businesses in the country.

The deal that is subject to regulatory approvals will see the two telcos operate under a joint venture company to be named Airtel-Telkom.

In 2014, yuMobile exited the Kenyan market after selling its network and infrastructure to Safaricom as Airtel Kenya took over the company’s subscribers.

The merger will see the telcos combining operations in Kenya and establish an entity with enhanced scale and efficiency, larger distribution network and strategic brand presence.

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Even though the two firms say shareholding in the merger would be determined at later, reports indicate that Airtel Kenya would have a 50 percent stake, Helios will own a 40 percent while the government will have a 10 percent stake.

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A joint statement said: “The final shareholding will be determined at the closing of the transaction. Telkom Kenya has the option of holding up to 49 per cent of that shareholding.”

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The merger was welcomed by government officials with National Treasury Cabinet Secretary Henry Rotich saying the move is well aligned with the government’s agenda to optimize the value of the assets that it holds in trust, on behalf of Kenyans, while cementing the country’s position as a regional business hub and an international investment magnet.

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On his part, ICT Cabinet Secretary Joe Mucheru said: “Such mergers have had positive impact on the development of the sector and service levels to consumers in other markets. Similarly, we look forward to this merger leading to the introduction of new technologies and telecommunication products which will, in turn, support the growth of other business sectors of our economy.”

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