Sudan’s telecoms firm shrugs off US sanctions to expand in Africa

Mergers, Acquisitions and Financial Results

U.S. sanctions on Sudan’s telecoms company Sudatel are having no effect at all as it pursues an expansion into Africa by seeking stakes in Nigerian and Congolese operators, its Chief Executive said on Friday.

Sudatel, which is 26-percent state-owned, featured on a list of 31 Sudanese companies barred in May from doing business with American firms, as Washington ratcheted up pressure on Khartoum to halt violence in its Western Darfur region.

Sudatel CEO Emad Ahmed, visiting Senegal to hand over a $200 million cheque for a new telecoms licence, said the sanctions were not inhibiting its growth into West Africa, where it started mobile phone operations in Mauritania earlier this year.

"We are now in discussions with the government of Nigeria: we have already been discussing with an existing operator to acquire part of it," Ahmed told Reuters, adding the company was also in talks to join an existing operator in Congo.

"In Niger, there is a (mobile phone) tender which is already launched. We are going to participate in that tender."

Ahmed said Sudatel was focusing on West Africa, which has one of the continent’s fastest growing telecoms markets, and regarded southern African markets as more saturated. Analysts expect the number of subscribers in West Africa to double by 2011 to more than 100 million.

Sudatel, which is listed in Bahrain and Abu Dhabi, has in recent months paid $100 million to start mobile phone services in Mauritania before winning the licence for fixed-line and mobile services in Senegal, seeing off competition from Celtel, a subsidiary of Kuwait’s Zain .

Sudatel expects to start services in Senegal in six months and have coverage of all of Senegal’s main towns within three years. It expects to spend $500 million on rolling out its network over at least five years.

"By the end of the year, we hope to be in Mauritania, Senegal, Nigeria and one other West African country," Chief Commercial Officer Ihab Osman told reporters.

Sudatel had no intention of busting the U.S. sanctions and had notified its suppliers — including Ericsson , Nokia , Alcatel , Siemens and Huawei — that they must not introduce any U.S. components into Sudan, Ahmed said. "The sanctions do not affect Sudatel at all. We are still dealing with the main builders of telecommunications ... except American companies," Ahmed said. "The technology is available everywhere: it is available in Europe, it is available in the Far East and China, especially in China."