Bharti Airtel Ltd. And Millicom International Cellular S.A. on Friday announced the merging of their subsidiaries in Ghana, Airtel Ghana Ltd., and Tigo Ghana Ltd, into a one co-owned telecom company. The two companies will have equal shares and governance rights in the new co-owned company.
The merger is subject to approval from the relevant authorities in Ghana and the fulfillment of the traditional closing conditions. If approved, the new co-owned telecom will serve a market with about 10 million customers, half of whom are data consumers.
The new telecom will serve over 80% of the population with high-speed internet as it will have the widest 3G cover across Ghana. The telecom revenue is estimated to hit $300m and become one of the largest telecom companies in the country.
The merging of the two networks will lead to a combined business that is expected to give Ghanaians significant boost in both the urban and rural network coverage. That is as far as better voice quality, high mobile internet connection, and reinforced stability and resilience of the network.
The combined business also promises to offer large and small companies access to a wider portfolio of world class solutions. It is also expected there to be a better Mobile Financial Services integration across the agent networks and platforms.
“In a highly fragmented telecom market, this deal represents a major milestone for our business in Ghana,” said Mohamed Dabbour, the Executive Vice President at Millicom Africa. “The combination of Tigo and Airtel will create an operator that will be able to offer Ghanaian consumers and businesses a state of the art network with high-speed mobile data coverage. This transaction underlines confidence in the Ghanaian economy, and provides the opportunity to develop nationwide digital infrastructure and service in Ghana.”
His counterpart, the MD, and CEO of Airtel Africa, Raghunath Mandava, said: “The agreement highlights our commitment to the Ghana market and our customers. The coming together of the two entities will benefit customers, who can now enjoy an extensive combined network and a wider range of affordable and innovative products and services. It will further strengthen our position in the market and offer huge benefits arising out of synergies in operations, resulting in better experience for the customers.”