Airtel Africa Plc and Telkom Kenya Ltd have agreed to discontinue the completion of their merger plans due to the lengthy process of the transaction which has been on since February 2019.
The two telecom firms resolved not to complete the business combination despite their respective efforts to reach a successful closure and having it drag on for a while.
The discontinuation disclosure was made in a notification sent on Wednesday, August 5, 2020, to the Nigerian Stock Exchange (NSE) by Airtel Africa and signed by its Group Company Secretary, Simon O’Hara.
A subsidiary of Airtel Africa Plc, Airtel Networks Kenya Limited and Telkom Kenya Limited, in collaboration with other parties, had entered into an agreement on February 2019 to combine their businesses in Kenya, so as to create an integrated telecommunications platform with mobile, enterprise and wholesale divisions.
Airtel Africa Plc said in its statement, “Airtel Networks Kenya Limited (Airtel Kenya), an Airtel Africa Plc subsidiary, and Telkom Kenya Limited (Telkom) amongst other parties, had entered into an agreement dated 8th February, 2019 to combine their businesses in Kenya, so as to create an integrated telecommunications platform with mobile, enterprise, and wholesale divisions.’
‘’The completion of the business combination was subject to the satisfaction of various conditions precedent, including regulatory approvals.’’
“Despite Airtel Africa Plc and Telkom respective endeavours to reach a successful closure, the transaction has gone through a very lengthy process which has led the parties to reconsider their stance.
“Accordingly, Airtel Africa Plc and Telkom have decided to no longer pursue completion of the Transaction.’’
Chief Executive Officer of Airtel Africa Plc, Raghunath Mandava, in his own reaction, said that Kenya was a large and growing market and stressed on the commitment of Airtel Africa to build a growing profitable business.
Mandava disclosed that the telecoms giant currently serves over 14 million Kenyan customers, a number that is growing every month.
He pointed out that the revenue numbers were up double-digit in constant currency in Kenya in the last quarter.
The Airtel boss reiterated that the strategy of the firm is to focus on winning more customers, invest in a best in class voice and data network and progressively expand their mobile money business.
He promised that the company will continue to build on these results in order to deliver against the opportunities the Kenyan market has to offer.
Airtel Africa is a leading provider of telecommunications and mobile money services with presence in 14 countries in Africa primarily in East Africa, Central and West Africa.