Airtel strikes deal to buy Millicom's Rwanda unit
Millicom continues to offload non-core assets after agreeing to sell Tigo Rwanda to Bharti Airtel
Bharti Airtel has struck a deal with Millicom that will see its Rwandan unit acquire a 100% equity stake in Tigo Rwanda.
The deal is based on approximately 6x EBITDA payable over a two year period, according to a statement from the two telcos, and subject to regulatory and statutory approval.
It will make Airtel a strong number two player in the Rwandan telecoms market, and follows a merger of Airtel and Tigo’s operations in Ghana.
Sunil Bharti Mittal, chairman of Bharti Airtel, said: "Airtel has taken proactive steps in Africa to consolidate and realign the market structure in the last few remaining countries where its operations are lagging on account of lower market share and presence of too many operators. Airtel and Tigo have already merged their operations to create a strong viable entity in Ghana.”
Mittal recently admitted that Airtel’s moves in the African market was “a bit rushed” in an interview with Indian press. It has recently been solidifying its position in Africa with deals in Uganda, Congo B, and Kenya.
Tigo's 370 million customers will join the network of Airtel Rwanda. 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%.
Mauricio Ramos, CEO of Millicom, commented: “The sale of our business in Rwanda is in line with our strategy to focus on providing advanced fixed and mobile data services in Latin America. We are very grateful to the government of Rwanda for their support throughout the last eight years, which allowed us to extend digital inclusion to thousands of Rwandans.
“We are also very grateful to all our employees, whose drive and commitment enabled Tigo Rwanda to become a leading provider of digital services in the country. We are confident that Bharti Airtel will build on the strength of Tigo Rwanda and enhance the services provided to customers.”