Essar to buy stake in Warid’s African ops

Essar Group set to strengthen its position in Africa after signing deal with UAE's Abu Dhabi Group to invest in Warid Telecom

Tags: Abu Dhabi GroupCongoIndiaInvestmentUgandaUnited Arab EmiratesWarid Telecom
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Essar to buy stake in Warid’s African ops Africa's telecoms sector is attracting increasing attention from Indian operators.
By  Roger Field Published  November 19, 2009

India's Essar Group is set to acquire a majority stake in Warid Telecom's Uganda and Congo operations from the UAE's Abu Dhabi Group.

Essar Group, which signed a deal with Abu Dhabi Group earlier this week, has committed capital to expand the networks of both of Warid's telecom operations, which have a combined value of about $318 million. On completion of the deal, Essar said it will acquire a majority stake in both of the telecom operations.

Abu Dhabi Group, which also owns Warid Telecom operations in Bangladesh and Pakistan, said the deal would help Warid expand further into Africa.

HH Sheikh Nahayan Mabarak Al Nahayan, chairman of Dhabi Group, said: "Warid has expanded its green field operations to become credible competitors and challengers in the market where it operates; the time is now right for the next stage of its growth and evolution."

Prashant Ruia, group chief executive, Essar Group said the deal was "in line" with Essar's plan to be part of Africa's fast growing telecom sector. "This transaction with the Dhabi Group augments our successful launch of telecom services in Kenya under the brand ‘yu' which was a stepping stone for Essar to expand its telecom footprint to the African continent," he said.

Ruia added that Essar's investment in Warid Telecom in Africa is part of a plan to grow its business in Africa and the Middle East by forging partnerships local business groups.

After the successful launch of mobile services in Kenya under the brand ‘yu', Essar Telecom Kenya now has more than 600,000 subscribers and expects this number to grow significantly as it completes its rollout across the country.

The Dhabi Group transaction is subject to regulatory approvals in Uganda and Republic of Congo. Standard Chartered Bank acted as exclusive financial advisor to the Dhabi Group.

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