Safaricom owners meet to approve yuMobile deal
What you need to know:
- The transaction, which also included Airtel, involves Safaricom taking over 150 yuMobile employees while Airtel will retain 25.
- A local platform could see Safaricom pay less M-Pesa licence fees to its parent company Vodafone starting April 2015.
Safaricom shareholders are Tuesday expected to approve a deal to acquire yuMobile assets. During the annual general meeting, the firm will also be seeking the investors’ nod for a new M-Pesa platform to be hosted locally.
“During the meeting, the board will seek shareholders’ approval for the acquisition of the passive network on the Essar Telecom (yuMobile),” Safaricom said yesterday.
The firm received regulatory approval last month to acquire the rival’s assets, including frequency spectrum, transmission towers and IT equipment in a deal estimated at Sh6.9 billion.
EMPLOYEES
The transaction, which also included Airtel, involves Safaricom taking over 150 yuMobile employees while Airtel will retain 25.
If the deal goes through, Safaricom will have a greater frequency spectrum to accommodate its growing customer base that reached 21 million between January and March and also to improve the quality of its voice service.
A local platform could see Safaricom pay less M-Pesa licence fees to its parent company Vodafone starting April 2015.
The latter is entitled to permit fees calculated as a fraction of M-Pesa’s annual turnover, as the inventor of the mobile money payment system.
Vodafone has also been getting annual fees from Safaricom for maintenance of servers in Germany.
The UK firm received a total of Sh2.9 billion out of the Sh26.56 billion revenue generated by Safaricom from M-Pesa services in the year ended March 2014.
Currently, M-Pesa transactions are routed to Germany and bounced back to Kenya.
This has been blamed for system delays and service outages when connection is disrupted due to under-sea fibre optic cable cuts.
