Residents use mobile handsets on a street in Nairobi, Kenya, on Wednesday, April 17, 2013. Though only 23 percent of houses there have electricity and just 9 percent of roads are paved, mobile-phone penetration is 75 percent in the country, up from 5 percent in 2003. Photographer: Trevor Snapp/Bloomberg Residents use mobile handsets on a street in Nairobi, Kenya, on Wednesday, April 17, 2013. Though only 23 percent of houses there have electricity and just 9 percent of roads are paved, mobile-phone penetration is 75 percent in the country, up from 5 percent in 2003. Photographer: Trevor Snapp/Bloomberg
Nairobi - Safaricom might abandon its bid to acquire assets of Essar Telecom Kenya in the absence of regulatory approval, east Africa’s biggest cellular network operator said this week.
A month after the firm asked the Communications Authority of Kenya for clearance to make the acquisition, the regulator had yet to acknowledge receipt of the application, Safaricom’s corporate affairs director, Nzioka Waita, said.
Francis Wangusi, the director-general of the regulator, declined to comment.
“This transaction was time- bound,” Waita said on Monday. “We are giving consideration to pulling out for the simple reason that the lack of regulatory certainty puts us in a place where the key fundamentals of the transaction have changed.”
Safaricom, 40 percent held by Vodafone, and Airtel Kenya might spend “in the hundreds of millions of dollars” acquiring Essar, Kenya’s third-biggest cellular network, Waita said.
Safaricom plans to buy Essar’s network base stations and transmission equipment. The regulator has demanded that Safaricom improve its network quality before being granted a new licence. Airtel, the second- biggest operator, is set to take over Essar’s 2.75 million subscribers and licences.
Essar, which is being sold after piling up losses over the past six years, has also yet to hear from the regulator. – Bloomberg