Bharti Airtel has announced said that it has entered into a definitive agreement with Millicom – which operates the Tigo telco brand – to acquire the firm’s subsidiary in Rwanda. The acquisition means that Bharti Airtel, which already has operations in Rwanda (as Airtel Rwanda), will now absorb Tigo Rwanda and thereby consolidate the country’s telecom market and position Airtel as the second largest operator in the country after MTN.
Sunil Bharti Mittal, Chairman, 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. 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.
We are also committed to the long term viability of our operations in two other countries i.e. Kenya and Tanzania, to ensure that in 2018 all our 15 operations in Africa start contributing positive margins and cash flows towards a healthy and profitable Airtel Africa.”
The agreement aims to bring together the strengths of Airtel and Millicom in Rwanda and offer benefits to customers in the form of a wider network, affordable voice and data services, and superior customer care. The existing customers of Tigo Rwanda will join Airtel’s global network, which currently serves over 370 million customers across 17 countries. They will enjoy, amongst other things, benefits of the ‘One Airtel’ network with lower roaming rates across Africa and South Asia, an exciting bouquet of innovative services including Airtel Money.
According to industry stats from the Rwanda Utilities Regulatory Authority (RURA), Airtel had 1.628 million subscribers in October this year while Tigo had 3.5 million customers on its network during the same period. The combined subscriber base of the two firms therefore becomes 5.2 million, higher than that of current market leader MTN which had reported about 4 million users by December 2016.
Raghunath Mandava, MD and CEO, Airtel Africa, said, “The acquisition reinforces our commitment to the Rwanda market and is a significant step towards creating a stronger presence in the country. It will create synergies with our existing business and help boost operational efficiencies in the market. The Rwandan telecom market will significantly benefit from this acquisition, further reiterating our stand that in-market consolidations do not just help achieve better market positions but benefit customers and the industry as a whole.”
On completion, the proposed acquisition will undergo seamless integration, both on the customer as well as the network side, and further strengthen our market position.
Over the years Airtel has been solidifying its market position to become a key player in the continent with in-country acquisitions. In the past, Airtel acquired assets in Uganda (Warid) and Congo B (Warid), Kenya (yu Mobile) and consolidated operations in Ghana (Millicom). The customers in these consolidated markets benefit from a superior and wider network, affordable voice and data services, Airtel Money and better customer care.