Rwanda: LAP Green Now Wants Rwandatel Back


The long awaited liquidation process of Rwandatel's assets that are to be put up for sale in order to pay off its debts has attracted a number of big players from the market, including the firm's former majority share holders, LAP Green, a top official has disclosed.

A court decision, last year, that placed Rwandatel under liquidation, indicated that the process is set to commence this year. The firm's woes started when its GSM licence was revoked, early last year, by sector regulator Rwanda Utilities Regulatory Agency (RURA), following what RURA insisted was the failure by Rwandatel to comply with its operating obligation.

With the liquidation process which is very likely during the course of the first quarter, RURA Director General, Regis Gatarayiha, confirmed to Business Times, in a phone interview, that various "big telecom firms" are now keen to snap up Rwandatel's assets including LAP Green. "They approached us with a view of participating in the liquidation process and it is possible they (LAP Green) will participate like any other potential buyers," Gatarayiha noted, adding that,"LAP Green is not the only potential buyer that is attracted to Rwandatel assets, they are many others and the highest bidder is, thus, expected to take over the assets."

LAP Green is an investment arm that was started by the government of former Libyan leader Col. Muammar Gaddafi, who was ousted and later killed last year, during an uprising in the African oil rich nation.

Asked whether it will be automatic for the winner of the liquidation process to be awarded a GSM license, Gatarayiha disclosed that RURA does not guarantee such a prospect. "Currently we have three licensed mobile operators, so we have to decide whether the country needs the fourth licence before the process of granting a new license can commence," he explained.

Recent figures from RURA indicate that active mobile subscribers have increased by 1.3 per cent, to 4,424,089 by November, last year, up from 4,370,145 in October last year. Rwanda's telecoms sector witnessed shifting dynamics following Rwandatel's loss of GSM license.

An immediate repercussion of changing landscape saw the market leader MTN Rwanda registering a comparatively lower rate of subscriber increment compared to its rival Tigo. MTN added 11,395 new users on to its network, from 2,888,869 in October, last year, to 2,900,264 subscribers in November, last year, representing a 0.4 per cent increment. On the other hand, Tigo recorded a 2.8 per cent increase on its network by having 1,523,825 users in November, last year, from 1,481,276 in October last year.

RURA's decision April last year, meant that Rwandatel's network connection for mobile and 3G data was switched off, a move that kick started a bitter duopoly race between MTN and Tigo.

RURA's decision, passed in accordance with article 57 of law no 44/2001 of 30/11/2001 governing telecommunications in Rwanda, states that once non-compliance has been reached and an operator is stripped of its license, regaining a new license by the affected operator can only occur upon government's decision to issue a new operating license.

Experts say that, with the current situation whereby there are three operators in the market after the entry of Bharti Airtel, there remains only a very slim chance for RURA to issue a new licence any time soon.

RURA says that as, a regulator, it is not responsible for the liquidation process, pointing out that the process is in the hands of an administrator, appointed by a court of law.