This archive report was first published on 4 September 2019.
Published on September 4, 2019, Safaricom has asked Telkom and Airtel to settle their debt of Sh. 1.2 billion before proceeding with their plans to merge.
According to Safaricom, the debt was incurred for the provision of various services including interconnections, co-location, and fibre services.
"This debt is due and payable, based on the agreement to provide services entered into with the two entities as distinct operators. Our expectation is that the payment obligations should be settled in full before the transfer of business is effected," said Michael Joseph, Safaricom's acting CEO.
Additionally, Safaricom has raised concerns about the proposed merger creating a disproportionate imbalance in the spectrum allocation. The company claims that Airtel and Telkom will jointly hold 77.5 MHz of the spectrum against a customer base of 17.3 million, compared to Safaricom's 57.5 MHz with almost double the customer base at 31.8 million.
"Given the size of Safaricom's customer base in comparison to the current spectrum holdings, it is apparent that the transaction will create a disproportionate imbalance in the spectrum allocation, which will be inconsistent with the market share," Michael Joseph said.
