Thursday, March 3, 2011

Essar Kenya gets new CEO

Outgoing Yu country manager Atul Chaturvedi. Photo/LIZ MUTHONI

Outgoing Yu country manager Atul Chaturvedi. Photo/LIZ MUTHONI 

By JEVANS NYABIAGE

Mr Madhur Taneja has replaced Atul Chaturvedi at Essar Telecom Kenya, in a latest restructuring, as the telecommunications industry reel from stiff competition.

The new boss has been the chief executive officer of Warid Telecom, Uganda.

Mr Chaturvedi who has been at the helm of Kenya’s third mobile phone operator for less than a year moves out to take up what he says other assignments.

When contacted, Mr Chaturvedi confirmed his exit and said that he is in the country until the end of March to take some important projects to conclusions.

“It is true that I’m leaving for other assignments, but will definitely introduce you to new boss when right time comes,” Mr Chaturvedi said.

Essar group has 51 per cent stake in Dhabi Group’s Warid Telecom operations in Uganda and Congo.

The combined value of Warid Telecom Uganda and Warid Telecom Congo is estimated to be Sh25.4 billion ($318 million).

The biggest challenge for the new chief executive is growing business numbers, at a time when stiff competition has hit on the firm, as the other operators strive to increase their market share and Safaricom—the market leader, continues to defend its market share.

Latest data from the Communication Commission of Kenya (CCK) show that Yu was the only operator that lost subscribers in the quarter ended October, shedding 26,266 subscribers to 1, 465, 832.

This saw it drop the market rankings from 7.4 per cent stake in June to 6.7 per cent in October while its rivals Airtel and Orange grew their shares from 9.1 per cent to 13.5 per cent and 2.7 per cent to 4 per cent respectively over the period.

Safaricom’s market share dropped to 75.9 per cent from 80.7 per cent, but it gained 473, 979 subscribers in the same period.

Ruias-owned Essar group has been pursuing for the mass market model similar to that of Bharti Airtel, also whose principal shareholders are Indian-based.

Airtel sparked a price war in the industry in August when it slashed calling rates by more than half to Sh3 per minute across all networks.

The two firms say their aim to build market share by reducing price barriers to the consumer.

In Uganda, Warid Telecom initiated a price war that has seen calling rates fall, prompting the industry regulator, Uganda Communications Commission (UCC) to issue new guidelines, which becomes effective March 15 shall empower UCC to establish minimum rates below which players will not be allowed to offer services, even under promotions.

Mr Taneja becomes the fourth boss at the helm of yu since its entry into the Kenyan market in 2008, then known as Econet Wireless Kenya.

The firm’s first chief executive officer Mr Michael Foley exited just six months after he took up the appointment.

His deputy, Mr Srinivasa Iyengar took over but did not last for more than a year before Mr Chaturvedi was brought in from India.

In its cost cutting measures, yu, earlier this month, terminated its contract with Aegis Services Kenya Ltd.

The operator instead opted for Horizon Contact Centre to handle its call centre services and the affected employees been asked to reapply for their positions.

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