Bharti Airtel on Wednesday announced that it has received an approval for the acquisition of Tigo Rwanda Limited, a subsidiary of Millicom International Cellular SA – Millicom – from the Rwanda Utilities Regulatory Authority (RURA). The merged entity will have the largest customer base in Rwanda with 5.9 million subscribers. The combined networks of the two companies will serve customers with voice or data services, global roaming and mobile banking services. The global telecommunications services provider with operations in 16 countries across Asia and Africa will also have Rwanda’s largest sales and distribution network.
The merger will result in the only negative ebitda OpCo joining other 13 positive ebitda OpCos in Africa. On completion, the acquisition will undergo seamless integration, both on the customer as well as the network side and further strengthen Airtel’s market position in Rwanda. Telecom operator Bharti Airtel in December last year had signed an agreement with Millicom International Cellular SA to acquire 100 percent stake in its Rwanda operation which operates under the brand name of Tigo Rwanda. “Bharti Airtel Limited…has entered into a definitive agreement with Millicom International Cellular SA (Millicom) under which Airtel Rwanda Limited will acquire 100 percent equity interest in Tigo Rwanda Limited,” Bharti Airtel said in a statement. Under this deal, Tigo’s 370 million customers will join the network of Airtel Rwanda. Bharti Airtel shares closed at Rs 456.55 down by 7 percent on NSE today.
The acquisition will make Airtel Rwanda the second largest operator in the country with revenues of over $80 million and a revenue market share of over 40 percent, the statement said. “The consideration for the transaction is based on approximately 6x EBITDA multiple, payable over two years. The agreement is subject to regulatory and statutory approvals,” the statement had said. Airtel at present operates in 15 African countries apart from India and South Asia. “Airtel and Tigo have already merged their operations to create a strong viable entity in Ghana. Today, it has taken yet another important step to acquire Tigo Rwanda to become a profitable and a strong challenger in a two-player market,” Bharti Airtel Chairman, Sunil Bharti Mittal had said. In the past, Airtel has acquired assets in Uganda (Warid) and Congo B (Warid), Kenya (yu Mobile) and consolidated operations in Ghana (Millicom).
