By Frankline Sunday
Kenyans could soon buy shares in Airtel as the country’s second-largest telco eyes listing on the Nairobi Securities Exchange (NSE) in the next year.
Airtel Africa Group Chief Executive Segun Ogunsanya said the telco was exploring its options in meeting compliance with a government directive to have foreign tech companies cede at least 30 per cent of shareholding to local investors by March 2024.
“There are a number of options; we can identify a local shareholder we can also list at the Nairobi Securities Exchange, NSE,” he said.
Ogunsanya was speaking in Nairobi during the launch of the company’s eSim in the Kenyan market as it seeks to improve its service offering and adapt to the evolving marketplace.
“We keep discussing with the regulator as to which one is the best route to ensure there is local participation in the business. We are very committed to doing this and we commit to having it done by the deadline, March 2024,” he added.
According to the National Information Communications and Technology Policy Guidelines 2020, only companies with at least 30 per cent substantive Kenyan ownership, either corporate or individual, will be licensed to provide ICT services by March 2024.
In recent years, Airtel Africa has offloaded segments of its multi-billion-shilling business to local shareholders in a bid to raise more funds for capital expansion and to meet regulatory requirements in the counties it operates.
“Kenya is the second country in our portfolio where we are launching the eSIM which is the next evolutionary change after the Nano SIM,” he said.
In 2021, Airtel Africa sold a Sh20 billion(US$157.85billion) minority stake in its mobile money business, and the company has since been listed on the Nigerian Stock Exchange and had set a December 2022 deadline to debut on the Ugandan Securities Exchange.
While companies can seek an exemption from the ICT ministry, Airtel Africa cited the policy change as one of the key risks to its business in a recent briefing to shareholders.
“The ICT Policy amendment will affect Airtel Africa’s Kenya business as follows: Airtel Networks Kenya Ltd, which currently holds an indefinite exemption from the Minister for ICT, dated March 20, 2013, has three years with effect from April 9, 2021, to comply with the requirement to have a 30 per cent local shareholding,” Airtel said in its latest annual report.
Airtel Africa currently counts 138.5 million subscribers out of which 17.2 million are in Kenya, with the country contributing the bulk of revenues generated from the East African business, which also includes Malawi, Rwanda, Tanzania, Uganda and Zambia.
According to the firm’s latest financial reports, Airtel East Africa generated Sh142.2 billion in revenue in the nine months ended December 2022 and Sh43.3 billion in operating profit over the same period of time.
Last year, Airtel Kenya invested Sh4.7 billion in acquiring additional spectrum valid to the year 2037 to deepen its 4G network across the country and roll out its 5G network.
Ogunsanya, who was yesterday scheduled to meet President William Ruto at State House, said the company expected to put up 350 sites over the next year, out of which 100 are expected to go live by next month.
“We are still at the pilot stage of the 5G rollout and have launched a couple of sites,” he said. We continue to lay fibre and in a couple of months we will be ready for commercial launch.”
Data from the industry regulator, the Communications Authority of Kenya (CA), indicates that Airtel Kenya currently has a 25 per cent market share, behind industry leader Safaricom (65 per cent).
The spectrum acquisition came on the back of a settlement between Airtel Kenya and CA for the settlement of a disputed Sh2.2 billion spectrum payment arising from the company’s 2014 acquisition of Essar’s Yu Mobile.
The licence was supposed to lapse in 2025, and Airtel Kenya agreed to pay a total of $20 million (Sh2.36 billion) in four instalments over the next three years.
