This archive report was first published on 22 November 2019.
Published on November 22, 2019
Safaricom, Kenya's largest telecom operator, has announced plans to bid for a telecom licence in Ethiopia, in partnership with South Africa's Vodacom.
The move comes as Ethiopia prepares to award two new telecoms licences by April next year, with firms keen on bidding having until November 22 to show interest.
According to Safaricom's acting CEO, Michael Joseph, the high entry costs for the licence, expected to breach the Ksh100 billion (about Tsh2.2 trillion) mark, have prompted the joint bid.
"We anticipate that the investment in the network and the spectrum would be quite high and therefore there is an advantage in bidding together with our shareholder," Mr Joseph said in an interview with the Business Daily.
The joint bid is seen as a strategic move by Safaricom to replicate its Kenyan success in the neighbouring country, where it has a strong mobile money platform, M-Pesa.
With a population of 100 million, Ethiopia offers a huge market for Safaricom, which is attracted by the growth potential in the country's mobile market.
Players like Safaricom are drawn to the country's fast-growing economy, which has averaged 10 per cent growth in the past five years, and its ongoing economic reforms that look set to strengthen investor sentiment.
