Etisalat to sell West African business to Maroc Telecom for $650 million
Etisalat, the UAE’s biggest telecoms operator, will sell its West African operations to Maroc Telecom in a deal worth US$650 million (Dh2.38 billion), ahead of the completion of its acquisition of a majority stake in the Maghreb company.
Etisalat is selling its operations in Benin, the Central African Republic, Gabon, Ivory Coast, Niger and Togo, it said.
These operations provide mobile voice and data services under the Moov brand. The deal will also include Prestige Telecom in Ivory Coast, which provides IT services to the operations of Etisalat in those countries.
In November, Etisalat agreed to buy French Vivendi’s 53 per cent stake in Maroc Telecom in a deal worth $5.8bn. The deal is expected to be completed by the end of this month and will help Etisalat expand its presence in Africa. Etisalat also operates in a number of other African countries, including Sudan, Nigeria and Tanzania.
Last week, Etisalat said that it had signed a €3.15bn (Dh16.05bn) multi-currency loan to finance the acquisition of Vivendi’s stake in Maroc Telecom. The loan was signed with 17 international, regional and local banks.
“Today’s deal will allow Etisalat to transfer the management of its operations in francophone West Africa to Maroc Telecom,” said Matthew Reed, a principal analyst at Informa Telecoms and Media in Dubai.
“Maroc Telecom is seen as having been successful with its existing operations in sub-Saharan Africa.”
Closing the deal is subject to Etisalat’s acquisition of Maroc Telecom and regulatory approvals in the West African countries.
Mr Reed pointed out that there was an overlap between Etisalat and Maroc Telecom operations in Gabon. Etisalat has Moov (Atlantique) while Maroc Telecom controls Gabon Telecom.
“There could be a problem with the competition or regulatory authorities,” said Mr Reed.
Separately, the Cairo-based investment bank Beltone Financial said it expected Etisalat’s West African operations to account for 6 per cent of the company’s total revenues this financial year.
Etisalat’s African operations contributed to 7 per cent of the group’s revenue in the first quarter of this year.
Etisalat, which has subsidiaries in 15 countries in the Middle East, Africa and Asia, reported a first-quarter net income of Dh2bn, up 11 per cent year-on-year, as its subscribers across the group grew 3 per cent to 145 million.
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Published: May 5, 2014 04:00 AM