Airtel Connects Western Zambia

Mobile network operator Airtel Zambia has reportedly started rolling out infrastructure in the more remote parts of Zambia’s Western Province, as it looks to fend off competition and maintain its market share. 


Airtel Zambia managing director Fayaz King was quoted as saying that  contractors are already at work on extending the cellco’s coverage with a view to attracting increased numbers of rural subscribers. 


‘We are now going in areas like Mutomena, Lukena, Liuwa, Libonda Palace and Mishulundu in Western Zambia. Some of these areas can only be accessed by water. This is our commitment to addressing Zambia’s telecommunications needs,’ the executive noted.


 Further, Mr King said that the network expansion formed part of an initiative that his company had undertaken over the previous ten months aimed at bringing services to some of the country’s most rural regions. 


According to the report Airtel has connected 88 isolated rural areas and communities in Zambia as part of the project, in provinces including Luapula, Northern, North-Western, Eastern, Southern and Central as well as in some rural parts of the Copperbelt like Lufwanyama, Masaiti, and Mpongwe districts.

Airtel Zambia Minority Shareholders to Sue Over Delisting

Indian mobile giant Bharti Airtel’s bid to delist its Zambian subsidiary from the Lusaka bourse looks set to face further setbacks following reports that minority shareholders are now suing the company.

According to Reuters, the remaining minority shareholders, which account for around 3% of the total stock of Airtel Zambia, have filed an affidavit stating that they refuse to sell their holdings as they are unhappy with both the terms and price of sale proposed by Bharti.

‘The failure to comply with the Companies Act renders the subsequent acquisition notice impotent and without validity,’ the court document said. One sticking point is understood to be that Bharti has not disclosed the price at which it bought the bulk of its shares in the Zambian cellco, making it difficult for minority stockholders to decide on the matter.

Bharti To Take Full Control of Airtel Zambia

Having confirmed last month that it would reapply to delist its Zambian subsidiary after its initial attempt was rejected, India’s Bharti Airtel has contacted all of Airtel Zambia’s remaining minority shareholders to inform them of its intentions to forcibly acquire the stake in the cellco it does not currently hold. 


According to All Africa, Bharti has sent a letter to those minority shareholders which declined to sell their shares after it launched a mandatory offer in November 2010, with the communication advising the 2,000 or so remaining stakeholders that Bharti had now met all conditions set in the Companies Act which allow it to press forward with acquiring the holding.


‘Since the conditions have been met Airtel is now proceeding to issue this acquisition notice to the minority shareholders within the two-month period specified in Section 237(2) of the Companies Act,’ noted the letter. Bharti will pay ZMK710 (USD0.15) per share, the same price that it offered back in November last year.

Airtel To Increase Its Zambian Stake to 97%

India’s Bharti Airtel is expected to increase its stake in its Zambian listed subsidiary from 79% to 97% following the conclusion of a mandatory offer to buy out minority shareholders, launched in November.

Bharti first acquired a stake in Airtel Zambia when it purchased the assets of Kuwait’s Zain earlier this year. Under local rules, companies are usually delisted if a single shareholder owns more than a 95% stak

Zamtel Undertakes $23 Million Digitalisation Project

Zambia Telecommunications Company (Zamtel), the country’s state-owned fixed line incumbent, has reportedly commenced the first phase of a project costing around USD23 million under which it will decommission its analogue exchanges, according to Telecompaper.

It is understood that Zamtel will replace the old analogue exchanges with digital alternatives, which it claims will allow it to offer its fixed line customers additional features, including broadband, audio and video conferencing and missed call notifications.

The first phase of the programme, which follows a successful pilot at the Woodlands exchange in Lusaka, will run until January 2011, during which time exchanges in Ridgeway, Chinika, Emmasdale and Lusaka will be upgraded. According to Zamtel’s chief communications officer, Amon Jere, the second stage of the project will see the digital upgrades take place nationwide, and will begin in the first quarter of 2011.

Bharti's Bid For Zain Zambia Rejected By Bourse Regulator

Zambia’s Securities and Exchange Commission (SEC) has rejected Indian operator Bharti Airtel’s latest bid for the publicly listed stake of its majority-owned mobile subsidiary Zain Zambia, The Post reports.

According to the local newspaper, the SEC turned down a bid by Bharti Airtel of ZMK710 (USD0.144) per share for the 22% stake, with the offer refused on the basis that it was too far below market estimations.

This is the second time that Bharti has had an offer for the stake rejected; last month it put forward a ZMK675 per share proposal. It is believed that most commissioners at the SEC believe that the lowest acceptable price for Bharti to proceed with a mandatory offer would be ZWK1,126 per share.

Telkom SA Prepares to Spread Into the Rest of Africa

SOUTH African Telecommunications operator, Telkom, has secured operating licences in east, south and west Africa, the company revealed on Monday in an interview.

Responding to questions, Telkom spokesman Pynee Chetty said the telecoms giant had secured operating licences in Nigeria, Zimbabwe, Tanzania, Ghana, Kenya, Uganda, Zambia, Swaziland and Namibia.
“Telkom’s ambition is to become a significant Information Communication Technology (ICT) player in Sub-Saharan Africa, focusing on the enterprise market.

“Apart from the satellite-based (SAT3) cable system, Telkom has invested in the new WACS, EASSy and SAFE submarine cables systems to further strengthen its position with regards to connectivity on the African continent,” said Chetty.

He said the operations in those countries consisted of consumer and enterprise solutions within the respective markets.

Chetty said Telkom would continue to service all these markets and acquire capabilities, through partnerships or own assets, to meet the demands of the local African enterprise and global multinational customers.
“The company continues to investigate opportunities in Africa and endeavours to expand into countries where customer demand warrants such actions.
“As far as the specific products and services are concerned, it is logical to utilise existing skills and capabilities acquired in the domestic market as far as possible when entering new markets,” said Chetty.

Wananchi Gears to Roll Out in Nine Countries With Cisco Deal

Kenyan ISP Wananchi Online has signed a contract with US technology solutions firm Cisco to rollout triple-play services across nine countries in East Africa. The deal is supported by East Africa Capital Partners and Viscous Capital, a wholly-owned subsidiary of Cisco.

Wananchi Online, which claims to be the only triple-play operator in East Africa intends to tap into markets in Kenya, Uganda, Tanzania, Rwanda, Burundi, Malawi, Ethiopia, Sudan and Zambia. The contract will see Wananchi Online deploying Cisco's integrated end-to-end network technology solutions - encompassing its ‘Borderless Networks’ and collaboration and data centre virtualization solutions.

Wananchi intends to extend a backhaul and last-mile fibre network across Nairobi and Mombasa in Kenya and Dar es Salaam in Tanzania. It will also build a WiMAX wireless network to provide uncapped internet access in smaller urban centres in Kenya.

The company will supplement its WiMAX and fibre offerings with VSAT services for small and medium businesses, particularly in remote locations in East Africa. Its long-term plan is to take fibre to the smallest towns in the region. East Africa Capital Partners’ Richard Bell has admitted that Wananchi is keen to develop a network in South Africa too, but: ‘South Africa is still a very closed and regulated market. East Africa has leapfrogged ahead of South Africa. If we could get a licence to build a cable network in South Africa, we’d be there in a second.’

Mark Schneider, chairman of the Wananchi Group commented: ‘The entertainment market for both home and corporate customers in Africa as a whole continues to be reshaped in light of technological advancements and new industry partnerships. The Wananchi Group's key objective is to expand our portfolio and enhance our commercial proposition, revenues and reputation. Cisco will help us to continuously deliver the necessary technology enhancements to our infrastructure to serve our ever-growing customer needs and remain at the forefront of delivering new and innovative services to our customers.’

Executives at Wananchi and Cisco said that the cost of international bandwidth in the region is now as cheap as it is anywhere in the world - thanks to the recent launches of EASSY, SEACOM and TEAMS submarine cables – making this type of increased investment possible.

Zamtel Spends US$34 Million In Fibre-Optic Project

Zambia’s monopoly fixed line operator Zambia Tele- communications Company (Zamtel) claims to have spent approximately USD34 million on laying fibre-optic cable across the country, AllAfrica reports.

The investment figure was revealed by Transport and Communications Deputy Minister Mubika Mubika in Parliament, who in responding to questions about the telco’s future spending plans noted that it remained unclear whether Libya’s LapGreen Networks, which recently acquired a 75% stake in Zamtel, would continue the current fibre rollout project.

LapGreen Networks submitted a USD257 million for the majority stake in Zamtel, and it was announced last month that it had beaten out bids from Russian telecoms investment firm Altimo and Unitel of Angola for the majority holding to win the holding. The government meanwhile has retained the remaining 25% stake, although it may sell this at a later stage through an initial public offering on the Lusaka bourse.

Tanzania Retains 40pc Stake In Zain

The government of Tanzania is set to receive TZS15.4 billion (USD11.2 million) and to hold on to its 40% stake in fixed and mobile operator Zain Tanzania following the sale of the telco to India’s Bharti Airtel.

Last month the Indians finalised the acquisition of the African assets of Kuwait-based Zain Group, with the deal valued at USD10.7 billion. Under the terms of the deal, first announced in March 2010, Bharti will pay USD8.3 billion upfront, followed by a further cash payment of USD700 million after one year, while it will also take over approximately USD1.7 billion of Zain’s debt.

The Citizen now reports that the country's minister for Higher Education, Science and Technology, Prof Peter Msolla, told the National Assembly that the government is still in talks with Bharti Airtel concerning the sale. In a debate on the country’s budget for the 2010/11 financial year, Msolla said: ‘We met with the company’s officials on 21 June to discuss the sale… We have told them to finalise the evaluation of the assets so that we can determine whether the payment made to us is satisfactory.’ The minister went on to add: ‘Since the government has shares in the company, it is imperative that it be involved in transactions regarding the sale. The shares we hold in the company are assets that ensure our role is not underestimated.’

Bharti has taken over Zain’s operations in 15 countries: Burkina Faso, Chad, Republic of Congo, Democratic Republic of Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia. The Kuwaiti company’s subsidiaries in Morocco and Sudan were not included in the sale.

Bharti to Invest USD150 million in Zambia

India’s Bharti Airtel has revealed it expects to invest around USD150 million in Zambia, with the bulk of the funds being put towards enhancing both 2G and 3G coverage across the country.

According to the Lusaka Times, Bharti, which earlier this month finalised its USD10.7 billion deal to acquire the majority of Kuwait-based Zain’s African operations, has said that the investment will be made over a two- to three-year period. In addition, Manoj Kohli, Bharti Airtel International’s CEO, said that the company would look to make 3G services more affordable through measures such as tariff reduction, with such price changes likely to be introduced in the next six months.

Zain Zambia, which will eventually be rebranded with the Airtel moniker, is the country’s largest mobile network operator by subscribers.

At end-March 2010 the cellco had a subscriber base of 3.12 million, representing a market share of 68.8%.

Cel C Joins Zain's One Network

Zain has announced the expansion of its ‘One Network’ platform to South Africa in a strategic partnership with Cell C, the country’s smallest cellco. Over 41 million Zain customers across Zain Africa’s 15 mobile operations may now benefit from ‘One Network’ services when visiting South Africa. The ‘One Network’ borderless mobile phone platform enables pre-paid and post-paid Zain customers when travelling to another 'One Network’ partner country to be treated as a local customer in terms of pricing, while retaining home country service functionalities. Now, in South Africa, Zain customers will be able to make calls, send SMS and access the internet (data) at local rates of the visited country and to receive incoming calls at a minimal charge.

The 15 Zain countries that benefit from this service with Cell C in South Africa are: Burkina Faso, Chad, the Republic of the Congo, the Democratic Republic of the Congo, Gabon, Ghana, Kenya, Malawi, Madagascar, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia.

MTN Wants Interconnection Fees Investigated

MTN's Zambia subsidiary has submitted a request to the Zambia Competition Commission (ZCC) to investigate the interconnection charges it pays for terminating calls onto other networks. MTN's chief marketing officer, Ernst Fonterne­l told the Zambian Chronicle that the ZCC should determine the causes of high interconnectivity costs in Zambia, to help to come up with solutions on how to reduce the costs.

"We have put up an application through ZCC to look into the high connectivity rates within Zambia between the local players," he said. He added that  PricewaterhouseCoopers was also conducting a study on the high interconnectivity rates which would be completed by the end of next month.

The country currently has three mobile network operators with the following market shares; Zain (70%), MTN (20%) and Zamtel (10%) - based on statistics from the Mobile World subscriber database.

Bharti And Zain Sign Sale Deal

Just a few days after the revelation that the board of Kuwait-based telecoms group Zain had approved an offer for its African assets, India’s Bharti Airtel has announced that it has entered into a legally binding agreement for the acquisition. Under the terms of the agreement Bharti will make a cash payment of USD9 billion, of which USD8.3 billion will be paid on closing of the deal; the remaining USD0.7 billion will be due one year after completion. Further, Bharti will assume USD1.7 billion of consolidated debt obligations as part of the deal, making it the second largest ever overseas acquisition by an Indian company, only topped by the USD12.9 billion Tata Steel paid for UK-based Corus Group in 2007.

Marking Bharti’s third attempt to enter the African markets, after two failed attempts to purchase South Africa’s MTN Group, when the deal closes the Indian company’s subscriber base will increase by approximately 42 million, spread across 15 countries: Burkina Faso, Chad, Congo Brazzaville, Democratic Republic of Congo, Gabon, Ghana, Niger, Kenya, Madagascar, Malawi, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia. Zain’s Moroccan and Sudanese subsidiaries are, however, not included as part of the deal. Indian billionaire and Bharti’s chairman and founder, Sunil Mittal, said of the development: ‘With this acquisition, Bharti Airtel will be transformed into a truly global telecom company.’

Meanwhile, it was reported yesterday by Reuters that the government of Gabon may oppose the sale of Zain's Gabonese unit to Bharti. The state reportedly issued a statement saying that it disapproves of the transaction and 'reserves the right to take all necessary measures', adding that Zain Gabon has 'not complied' with local telecoms regulations.

MTN Zambia in USD 25 Million Expansion Drive

Zambian mobile network operator MTN Zambia has revealed it has set aside USD25 million for upgrade and expansion projects in 2010, according to the Times of Zambia.

A bulk of that investment will go towards expanding the cellco’s network to those districts that it does not yet cover, and MTN CEO Farhad Khan noted that work was already underway in seven such regions: Shang’ombo in Western Province; Chiengi, Chilubi and Milengi in Luapula; Chama in Eastern Province; and Chavuma and Kasempa in North Western Province.

Commenting on the expansion plans Khan said: ‘We will be expanding our network coverage this year and we target completion for August to completely cover the whole of Zambia.’ In addition, MTN Zambia has said it expects to boost its subscriber base to 1.5 million by December 2010; the cellco had 1.17 million mobile voice customers at end-2009.

Zambia Plans To Transfer Fibre Lines From Zesco to Zamtel

AllAfrica.com reports that the Zambian government is planning to put a number of fibre pairs currently controlled by state-owned power company Zesco in to the hands of Zambia Telecommunications Company (Zamtel). It is understood that the move is part of the state’s plans to make the telco more attractive to potential buyers, as the privatisation process of the operator moves forward.

Under the proposals the government will transfer seven of twelve fibre pairs that Zesco has; of the remaining five, two are used by Zesco to manage its power network, one is used by South Africa-based MTN, which owns a mobile operator in Zambia, while the last two are not currently in use.

Local ISPs have voiced their concerns about the proposals however, with one unnamed market operator stating: ‘All the ISPs don't want this to happen. We have a good relationship with Zesco and we put a lot of capacity through their link. If it happens, I'll have to lay fibre routes and that's not my business. We're looking at VoIP offerings because the current prices of international calling are still USD1.10-USD1.50 a minute.’

At present Chinese vendor Huawei is in the process of rolling out a fibre backbone for Zamtel, but it remains incomplete and by comparison to Zesco’s existing infrastructure is significantly less expansive. Zesco’s fibre network spans the economically active central part of the country from Lumwana and Solwezi in the north to Sesheke in the south.

The Zambian government first announced plans to divest a portion of its stake in Zamtel in December 2008. In September 2009 it revealed it would sell 75% of the struggling operator, and one year after initially unveiling its intention to sell, the Zambia Development Agency (ZDA), which is handling the process, announced the shortlist of bidders: India's Bharat Sanchar Nigam Ltd, Unitel of Angola and Libya's LAP Green Networks. Russia’s Altimo was subsequently added to the list, despite submitting its bid after deadline.

LAP Aquires 80% Stake in Sudan's Gemtel

Libyan government investment vehicle Libyan African Investments Portfolio (LAP) has acquired an 80% stake in Southern Sudanese telecoms operator Gemtel via its telecoms arm, LAP Green Networks, Ugandan news source The New Vision reports.

Gemtel was licensed by the Government of Southern Sudan (GoSS) in 1996 and launched commercial GSM services shortly after in the cities of Juba and Yei. By mid-2009 the company had expanded its footprint to cover Waw, Torit, Bor and Rumbek.

Gemtel uses the dialling code of Uganda (+256), thanks to an interconnection agreement with Uganda Telecom (UTL) signed in September 2006, which allows the cellco to use the gateway for USD50,000 in interconnection fees per month.

LAP Green already operates in East Africa through its 80% shareholding in Rwandan fixed line and mobile telephony operator Rwandatel and 69% stake in UTL. The company also holds an interest in Sahelcom and Sonitel of Niger, and controls Oricel Green, a mobile operator in Cote d’Ivoire.

According to a statement from LAP Green, the firm has been shortlisted to buy a 75% stake in Zambia’s sole fixed line operator, Zambia Telecommunications Company (Zamtel).

Four Listed For Zamtel Acquistion

Four bidders have been shortlisted to take a 75% stake in the state-owned telco, Zamtel. The bidders who shall proceed to the next round are India's BSNL, Libya's LAP Greencom, Unitel /Angola Cables of Angola and Russia's Altimo Holdings/VimpelCom.

The ZDA Board at meeting held on January 11, 2009 approved the recommended shortlist after detailed analysis conducted by an Evaluation Committee.

Commenting on the shortlist at a press briefing to announce the successful bidders, Mr. Muhabi Lungu, Acting Director General of the ZDA said he was happy with all four participants who have gone through to the next stage of the process. "The bids submitted were compelling, and set the stage for an exciting next phase," he added.

The four bidders will now be invited to participate in the next round of bidding, which is expected to begin during the week commencing 18 January, 2010. At the begining of this phase shortlisted bidders will be given details of the requirements and timing for the next phase of the process. Details of the bids will not be disclosed at this stage as doing so would prejudice future phases of the privatisation process.

Four ZAMTEL Bidders Submit Bids

Of the eight companies shortlisted in the sale process of a 75% stake in Zambian fixed line incumbent Zambia Telecommunications Company (Zamtel), only three have submitted bids. According to the Times of Zambia the three foreign companies to submit their offers to the Zambia Development Agency (ZDA) for the telco are India’s Bharat Sanchar Nigam Ltd (BSNL), Unitel of Angola and Libya-based LAP Greencom.

A fourth bid, from a consortium of Russia’s Vimpelcom and the telecoms arm of the Alfa Group, Altimo, was understood to have been sent on time, but reportedly arrived at the ZDA offices five minutes after the submission deadline as a result of ‘logistical reasons’. The bid however was still considered, and the ZDA board confirmed that Altimo’s non-binding offer had been accepted today. The four companies that had been shortlisted but chose not to bid were Telkom South Africa, BSNL’s fellow state-owned Indian telco Mahanagar Telephone Nigam Ltd (MTNL), Portugal Telecom and a consortium of Egypt-based Orascom Telecom and its subsidiary Telecel Globe.

ZDA acting director general, Muhabi Lungu, after opening the bids said the ZDA would now study the offers, while also passing the details on to the board of Zamtel for its evaluation. Mr Lungu has stated that the ZDA will announce which of the companies will move on to the next stage in the sale process on 11 January 2010, where another due diligence would be undertaken before the successful bidder is chosen.

New Zamtel Owner To Revitalise Company

­Zamtel's new owner could revitalise the company, gaining a 19% share of the mobile market by 2015, up from its current 4% share. According to Onda Analytics, the privatisation will lead to a major operator taking over Zamtel, providing a serious threat to existing Zambian mobile operators, Zain and MTN.

Interested parties, including MTNL, Telecel Globe (a subsidiary of Orascom), Telkom SA and Vimpelcom officially began due diligence this week.

According to report lead author, Daniel Jones (Partner), "The new investor will have to turn around an operator in crisis. A strategy along the lines of a new entrant will be needed, as Zamtel has fallen further and further behind in the mobile market. High mobile tariffs and low penetration in Zambia present an opportunity for the buyer. Aggressive price competition and going after subscribers new to the market will help Zamtel grow its market share and challenge its competitors".

Onda Analytics' new report considers the strategies that a new owner will need to adopt in order to turn the operator into a significant mobile player in Zambia. Under the right strategy, Onda Analytics forecasts Zamtel to grow its mobile market share from 4% in 2009 to 19% by 2015, increasing its subscriber base from 160 000 to 1.8 million. The report also analyses the strategic importance of Zamtel's other assets, including its fixed line network and the WiMAX network currently in deployment.

On top of increasing revenues, Zamtel will need to keep a close check on costs. "Zamtel's bloated cost base, as a result of its large headcount, has led it to insolvency and the current privatisation process" explains report co-author, Tom Harden, Partner at Onda Analytics. "Today, all the operator's unionised staff have agreed voluntary redundancy. A massive staff reduction programme will be need to be carried out by whichever company takes over Zamtel. The union has recognised this, hoping to get the best redundancy packages for its members by negotiating the government now, rather than the new owner later" explains Harden.