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Telkom-Airtel to finalise merger before December– official

The merger between telecommunications companies, Telkom and Airtel will be concluded before the end of this year, according to top official.

Telkom managing director Kris Senanu said the ongoing merger process and the expected closed transactions are valid.

In March, a National Assembly committee termed the planned merger a scandal.

The Committee of Implementation called upon government agencies including Communication Authorit,  National Treasury and Telkom Kenya to review the deal. 

“What we need is a good player in the market just as Safaricom has done. There has to be another viable alternative for consumers in the market and that is what we will be creating,” Senanu said.

The companies will combine their respective strengths, with Telkom bringing their intensive fibre network infrastructure to increase their market share.

Airtel has been growing in mobile services business in Kenya, holding 23.4 per cent of market share to 11,563,967 mobile subscriptions in the period between October and December 2018.

In the CA report, the figure represented a 6.2 per cent growth compared to 4,188,517 total subscriptions for the three months to September.

In the three months to December, Safaricom held 31,320,579 mobile subscriptions at 63.27 per cent while Telkom at 4,447,945, representing 8.98 per cent.

“It is simply a market issue as the companies will utilise on their unique strengths to grow faster, said Senanu.

He said the market  is still growing and if it enlarges for one provider it does not mean a reduction in revenue for another but instead a win-win competition.

Airtel agreed to the merger proposition in February after Telkom placed the request last year. The company will have an option of taking as much as 49 per cent of Telkom.

Telkom is owed majority by international private equity investment firm, Helios Investment Partners with 60 per cent while the government owns 40 per cent.

Safaricom is 35 per cent owned by South Africa‘s Vodacom, 35 per cent by the government, while the British multinational Vodafone owns five per cent. The remaining 25 per cent shares are owned by retail investors through the Nairobi Securities Exchange.

Airtel Kenya is a subsidiary of India’s telecom company, Bharti Airtel. 

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