Orange Group sells its stake in Ugandan firm
A Telkom Orange shop in Nairobi. The Orange Group is selling its majority stake in Orange Uganda to Africell Holdings from West Africa as part of an ongoing review of its operations in various African markets. PHOTO/FILE
What you need to know:
- The group entered the Ugandan market in 2008 and holds a 95 per cent stake in Orange Uganda.
- There has been speculation that the company is planning to exit the Kenyan market after failing to make profits in the highly competitive sector.
- Africell operates in Gambia, Sierra Leone and the Democratic Republic of Congo, and says it has about nine million active subscribers.
The Orange Group is selling its majority stake in its Ugandan business as part of an ongoing review of its operations in various African markets.
The company, which also owns 70 per cent of Telkom Kenya, said Monday it had struck a deal to sell Orange Uganda to West African telecom firm Africell Holdings.
“The transaction is subject to approval from the relevant authorities. It will enable the company in Uganda to continue its development,” read a statement from the company.
The group entered the Ugandan market in 2008 and holds a 95 per cent stake in Orange Uganda.
Earlier this year, the firm said that it was analysing its operations in Kenya and Uganda with a view to bringing new partners on board.
EXIT SPECULATION
There has been speculation that the company is planning to exit the Kenyan market after failing to make profits in the highly competitive sector.
According to reports published in Uganda’s Daily Monitor in March, Vodacom and South African firm MTN Group were in the race to acquire Orange Uganda shares.
The entry of Africell increases the number of operators in East Africa’s telecommunications industry.
Africell operates in Gambia, Sierra Leone and the Democratic Republic of Congo, and says it has about nine million active subscribers.
By acquiring Orange Uganda, the company will gain 620,000 new subscribers.
Orange Group’s review of its position in the region comes within the context of poor performance in Kenya and Uganda. Africell is hoping to change the situation in Uganda.
“We are confident of achieving a quick turnaround of the operation in Uganda; our operating model has proven that we will be able to offer an attractive proposition to the Ugandan consumer, allowing us to quickly climb the market share ladder and bring the operation into profitability,” said Africell Group chief operations officer Elias Arwadi.
