By Irene Gaitirira
Published January 14, 2016
A French telecommunications operator is acquiring Indiaâ€˜s Bharti Airtelâ€™s subsidiaries in Francophone Africa.
Franceâ€™s Orange shall take over Airtelâ€™s operations in Burkina Faso and Sierra Leone. Orange shall acquire 100% of the two companiesâ€™ share capital whose consolidated revenue is around â‚¬275 million. These acquisitions will be implemented in partnership with Orangeâ€™s subsidiaries in Ivory Coast and Senegal.
The outlay for Orange for these transactions will be based on the financials of Airtelâ€™s two subsidiaries for the year ended March 31, 2016 and will represent the equivalent of 7.9 times Airtelâ€™s EBITDA in these two countries at this time. The completion of these transactions is subject to approval by the competent authorities.
These buy-outs are said to be in line with Orangeâ€™s international development strategy, which places a priority on accelerating growth in high-potential, emerging markets where the Group is not already present.
Through this deal, Orange will reinforce its presence in Africa with two additional countries, adding almost 5.5 million customers to its mobile customer base. This acquisition will bring the Groupâ€™s African footprint up to 20 countries in 2016.
This is further to the initial agreement signed between Airtel and Orange in July 2015 regarding the potential acquisition of Airtelâ€™s operations in Burkina Faso, Sierra Leone, Chad and Congo Brazzaville. The agreements regarding potential transactions in the remaining two countries have lapsed.
Orange is also taking over 100% of Cellcom Telecommunications operations in Liberia.
France Telecom, that trades as Orange, operates in 28 countries with a customer base of 263 million customers worldwide at September 30, 2015. It is said to have 200 million mobile customers and 18 million fixed broadband customers.
Bharti Airtel operates in 20 countries across Asia and Africa. Headquartered in New Delhi, India, the company offers 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high speed DSL broadband, IPTV, DTH, and enterpris services in India; it offers 2G, 3G and 4G wireless services and mobile commerce in the rest of the geographies. Bharti Airtel was reported to have about 346 million customers across its operations at the end of November 2015.