The Essar Group has initiated discussions to pick up majority stake in the African telecom assets of the Dhabi Group, an investment company led by members of the Abu Dhabi royal family.
Through its subsidiary named Warid Telecom, the Dhabi Group owns mobile networks in Pakistan, Bangladesh, Congo, Uganda and Cote d’Ivoire. The discussions with the Essar group are for Congo and Uganda operations only.
A statement issued by the two groups today said the “two companies had agreed to enter into exclusive discussions in relation to an investment by the Essar Group into the telecommunications portfolio of Dhabi Group’s African assets”. Standard Chartered Bank is acting as exclusive financial advisor to the Dhabi Group.
However, sources close to the developments said Essar will pick up controlling stake in the African telecom assets.
A preliminary agreement between the Dhabi Group and Essar was signed in Abu Dhabi, in a meeting between Essar’s Group CEO Prashant Ruia and Dhabi Group Chairman Sheikh Nahayan Al-Nahayan.
The announcement comes just a fortnight after Essar bought majority stake in Econet Wireless Kenya, offering mobile services in that country under the “yu” brand name. The company already has around 4,00,000 subscribers on its network in Nairobi and Mombasa and expects the number to grow significantly as it completes it roll out across Kenya by end of the year.
Essar holds 33 per cent stake in Vodafone Essar, which is a joint venture with the Vodafone Group, and is one of India’s largest cellular service providers, with over 75 million subscribers. The group owns Essar Telecom Infrastructure, one of the largest independent telecom tower infrastructure providers in India and operates an outsourcing services business under the Aegis brand, with over 33,000 employees globally across 32 delivery centres in the Philippines, Costa Rica, US, Africa and India
Source: Business-Standard