Airtel Shareholding: Kenyans may soon own a stake in telecommunications firm Airtel. This follows the State’s push to have the firm sell a 30 per cent stake to Kenyans through new ownership rules for the telecommunications sector.
According to a report that appeared in a local daily on Monday, ICT cabinet secretary Joe Mucheru has introduced new ownership rules in the sector that will compel telecommunications firms to release 30 per cent stake to locals by the year 2024.
“An existing licensee that had a waiver granted under the ICT Sector Policy Guidelines of 2006 will have three years to meet the local equity ownership threshold with effect from the date of this Notice,” CS Mucheru was quoted in a policy notice.
However, the State has said that it could grant Airtel a waiver or extension on deadline, but did not reveal the conditions under which the waiver or extension would be issued.
Airtel is currently ranked as the second largest telecommunications firm. Safaricom is the market leader while Telkom takes up the third position.In early 2020, Airtel was set for a merger deal with Telkom. In August 2020, Telkom walked out of the deal, saying that the joint venture partnership had faced challenges in getting approval that have forced the firm to seek alternative strategic options. “After carefully reviewing the available options, Telkom has opted to adopt an alternative strategic direction and will no longer be pursuing the proposed joint venture transaction. This decision has been mutually agreed with Airtel Networks Kenya Limited,”Telkom CEO Mugo Kibati said.
Airtel has been largely unsuccessful in taming the market dominance of Safaricom, with a majority of its subscribers complaining that it has failed to invest in network development and infrastructure. For example, the latest industry data from the Communications Authority (CA) shows that the telco’s share of voice market grew to 69.2 per cent in the three months to December from 64.7 per cent in September. Airtel’s share of the voice market dropped to 28.5 per cent in the period under review from 32.1 per cent in September while Telkom Kenya’s share fell to 2.2 per cent from three per cent. Airtel Shareholding.