Vodafone Confirms Buying Majority Stake in Ghana Telecom
Vodafone has now confirmed that it is to take a 70% stake in Ghana Telecom for a payment of US$900 million. The transaction values Ghana Telecom at approximately US$1.3 billion. The Government of Ghana will retain a 30% stake in the company.
As part of the transaction price, it has been agreed that the Government of Ghana's fibre network assets will be transferred to Ghana Telecom.
Commenting on the transaction, Arun Sarin, Chief Executive of Vodafone, said "Ghana is one of the most attractive markets in Africa with mobile subscribers growing at more than 55% p.a. and mobile penetration around 35%. Our extensive operating experience together with our portfolio of products and services position us well to deliver a superior mobile experience to Ghanaian customers and significantly improve financial performance. I expect that our investment will generate substantial benefits for Vodafone and for the Ghanaian economy and we are delighted that we will be working in partnership with the Government of Ghana."
Over the next 5 years, Vodafone expects Ghana Telecom to invest over US$500 million in its operations and network, restoring and expanding network coverage and completing and integrating the fibre backbone.
Vodafone said that it also plans to leverage its experience of rapid network deployment in India and other emerging markets, its brand and customer propositions such as M-PESA and ultra-low cost handsets, to accelerate Ghana Telecom's growth.
Vodafone intends that Ghana Telecom will raise its mobile market share over time to around 25%, reversing recent underperformance.
According to figures from the Mobile World database, Ghana Telecom ended the last quarter with an estimated 1.3 million subscribers. There are four operators in the country at the moment, MTN (53%), Tigo (28.6%), Ghana Telecom (15.5%) and Kasapa Telecom (3.3%). Nigeria based Globalcom recently secured an operating license in the country.