Tuesday, March 19, 2024

Airtel now denies plan to exit Kenya

Airtel has denied claims it is planning to exit the Kenyan market.

Airtel Africa said in a statement that it was pursuing other options to turn the businesses profitable.

“We had stated that we are open to consolidation opportunities either through acquisitions or mergers, to create a viable business in these three (Kenya, Rwanda and Tanzania) markets. It was never said that we were looking at exiting these markets,” the statement said.

Airtel was making reference to a November 27 story by India’s Economic Timesindicating Kenya was one of the three African markets where the telecom firm is not performing positively, and needed to pursue an exit plan.

In August, Airtel Kenya posted its financial information for the first time, revealing the extent of the debt stock held by the struggling telco. According to the report, current liabilities in Airtel Kenya stood at Sh55 billion against current assets of Sh9.7 billion as at December 2016, making the company’s local operations technically insolvent.

Data from the CA sector statistics indicates that Airtel’s market share shrunk three per cent in the last quarter with total subscribers currently standing at 6.1 million as at June 30, 2017. The company saw a 25 per cent increase in the volume of voice traffic which rose from 1.2 billion minutes recorded in the previous quarter to 1.5 billion in June.

An analysis by Goldman Sachs shows that Kenya contributes about five per cent of the Airtel Africa’s revenue, a drop in the bucket in comparison to Nigeria’s 30 per cent and even lower than Uganda and Tanzania at eight and nine per cent respectively.

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