Warid, Essar Group partnership imminent
Wednesday, November 25, 2009 17:00Discussions have been on-going for some time now, but anytime this week, Warid Telecom, one of Uganda’s mobile phone companies, could become a new entity after entering a “partnership” with Essar Group.
Infact a source knowledgeable with the discussions said the deal between the two could have already been sealed by Friday last week although the two companies have remained silent on the deal.
“The deal is so advanced that senior managers of both companies are visiting Uganda next week (today) and will be visiting various African countries including Ethiopia and DRC looking for potential business opportunities,” the source said.
The visitors expected from India and Pakistan will tour various installations of Warid on the continent, speak to government officials and to familiarise with the business environment.
The partnership, according to the source, will involve an “an equity infusion” - a two-way acquisition of shares into both companies but it is not yet clear how the infusion will be shared.
Warid Telecom boss Zulqarnain Javaid did not deny the reports but was non committal.
“We want to grow in Africa, we have three licenses, and they have only one so it only makes business sense to work together. It is a genuine partnership because we want to increase our foot prints across the continent,” he said.
Details of the terms of the partnership are not yet clear however the deal will, according to reports, be overseen by Standard Chartered Bank.
Warid Telecom, owned by Dubai-based Dhabi Group, made a $250 million investment entry into Uganda in February 2008. Today, it boasts of 1.2 million customers and has become a major player in the Ugandan market.
Through its Warid Telecom subsidiary, the Dhabi Group owns mobile networks in Pakistan, Bangladesh, Congo, Uganda and Cote d’Ivoire.
A business partnership between Warid and Essar will increase their business footprint on the continent edging up competition against well established telecom entities like Kuwaiti’s Zain and South African-based MTN both of which have a greater chunk of the telecom market on the continent.
Essar’s telecom unit built one of India’s largest mobile networks, which it now owns in a joint venture with the Vodafone Group of the UK.
“Both companies have built, launched and operated telecom networks in emerging markets and the partnership is intended to capitalize on shared opportunities,” according to a press statement issued by Warid Telecom Uganda quoted by Reuters.
http://www.monitor.co.ug/artman/publish/business/Warid_Essar_Group_partnership_imminent_88705.shtml
