ADVERTISEMENT

Ghana demanding stake in Airtel-Tigo merger puts new entity in danger

Tigo could boycott merging with a company(Airtel) that is partially owned by government.

The demand being made by government is said to be a condition that must be accepted by Airtel Ghana before the regulator will sanction the merger with Tigo, operated by Millicom Ghana.

Reports say the government's demand is a prime factor holding back the National Communications Authority (NCA) from granting its approval to the merger.

ADVERTISEMENT

The merger when successful would create the second largest mobile network after MTN in Ghana.

It is estimated that the combined business would serve nearly 10 million customers, of which 5.6 million are data customers.

Sources close to the merger say government’s demand is premised on a decade-old transaction when the government sold 75 percent of its shares in Westel to MTC Group which operated Zain. Zain was later acquired by Airtel in 2010.

Over the years, through the Ghana National Petroleum Corporation (GNPC), the government of Ghana maintained a 25 percent stake in Airtel amidst accusations that it has not invested in the operations of the company as is required of all shareholders.

Reports also making rounds say Tigo could boycott merging with a company that is partially owned by the government, a situation that could change the dynamics of how they envision the proposed entity.

ADVERTISEMENT

Merger talks

According to the announcement made earlier this year, per the agreement, Airtel and Millicom, operators of Tigo, would have equal ownership and governance rights in the combined entity.

The resultant network operator would cover more than 80 percent of Ghana's population with high-speed data, providing the widest 3G coverage across the country, and would have revenues close to US$300 million, making it one of the largest communications companies in the country.

The combined business is expected to provide customers with a major boost in both rural and urban network coverage, translating into better voice quality, high-speed data services and reinforced network stability and resilience.

JOIN OUR PULSE COMMUNITY!

Unblock notifications in browser settings.
ADVERTISEMENT

Eyewitness? Submit your stories now via social or:

Email: eyewitness@pulse.com.gh

ADVERTISEMENT