Njowepo
JF-Expert Member
- Feb 26, 2008
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Times Reporter and Agencies
At first it was just romours. But now France-based media and telecoms conglomerate Vivendi has formally confirmed it is in talks to buy a controlling stake in Zain Africa.
In a statement, Vivendi affirmed its interest in acquiring a majority stake in Zain Group's Africa telecommunications businesses in line with its strategy of seeking growth in emerging countries.
Zain operates in 16 countries in Africa, including Kenya, and six in the Middle East. Zain Kenya is the second largest mobile company in Kenya.
The confirmation comes after weeks of speculation during which both firms have remained tight-lipped about any deal making talks after a Kuwaiti newspaper broke the story.
The company said this acquisition would enable Vivendi to capitalise on its experience in the region's mobile telephony market.
"However at this stage there is no certainty that the discussions will lead to a successful outcome," the statement said.
In any event, Vivendi said it would examine this investment according to its usual profitability criteria and would adhere to its financial discipline principles.
Like other telecoms in the region, Zain has been shifting its focus to the data market ahead of the expected revolution when Kenya is connected to the rest of the world through fibre optic cables.
Mobile telephony reach is estimated at around 40 per cent in the country and 65-70 per cent in urban areas.
Data services such as the provision of wireless broadband contributes 15 per cent to the company's revenues.
Established in September 2000, Zain--then trading as KenCell-- became the first private Kenyan company to offer GSM mobile services alongside the government-owned Safaricom.
However, two more operators - Orange Telkom and Essar - have since been licensed to operate.
This is not the first time Vivendi has shown an interest in investing in Africa's mobile phone service since it owned a 60 per cent stake in the same firm when its was known as KenCell.
It then sold its holding for $250 million (Sh19.2 billion at current exchange rates) to Celtel International, which later sold its shares to Zain Group for $ 3.4 billion (Sh260 billion) in March 2005.
Vivendi has presence in other African countries including Mauritania , Burkina Faso (Onatel), Morocco's Maroc and Gabon Telecom.
At first it was just romours. But now France-based media and telecoms conglomerate Vivendi has formally confirmed it is in talks to buy a controlling stake in Zain Africa.
In a statement, Vivendi affirmed its interest in acquiring a majority stake in Zain Group's Africa telecommunications businesses in line with its strategy of seeking growth in emerging countries.
Zain operates in 16 countries in Africa, including Kenya, and six in the Middle East. Zain Kenya is the second largest mobile company in Kenya.
The confirmation comes after weeks of speculation during which both firms have remained tight-lipped about any deal making talks after a Kuwaiti newspaper broke the story.
The company said this acquisition would enable Vivendi to capitalise on its experience in the region's mobile telephony market.
"However at this stage there is no certainty that the discussions will lead to a successful outcome," the statement said.
In any event, Vivendi said it would examine this investment according to its usual profitability criteria and would adhere to its financial discipline principles.
Like other telecoms in the region, Zain has been shifting its focus to the data market ahead of the expected revolution when Kenya is connected to the rest of the world through fibre optic cables.
Mobile telephony reach is estimated at around 40 per cent in the country and 65-70 per cent in urban areas.
Data services such as the provision of wireless broadband contributes 15 per cent to the company's revenues.
Established in September 2000, Zain--then trading as KenCell-- became the first private Kenyan company to offer GSM mobile services alongside the government-owned Safaricom.
However, two more operators - Orange Telkom and Essar - have since been licensed to operate.
This is not the first time Vivendi has shown an interest in investing in Africa's mobile phone service since it owned a 60 per cent stake in the same firm when its was known as KenCell.
It then sold its holding for $250 million (Sh19.2 billion at current exchange rates) to Celtel International, which later sold its shares to Zain Group for $ 3.4 billion (Sh260 billion) in March 2005.
Vivendi has presence in other African countries including Mauritania , Burkina Faso (Onatel), Morocco's Maroc and Gabon Telecom.
