Kenya’s two largest mobile operators are looking to buy the assets of struggling rival Essar Telecom Kenya (Yu Mobile).
A few days ago, Yu Mobile said it filed an application with the Communications Authority of Kenya (CAK) to transfer its operations….
Kenya’s two largest mobile operators are looking to buy the assets of struggling rival Essar Telecom Kenya (Yu Mobile).
A few days ago, Yu Mobile said it filed an application with the Communications Authority of Kenya (CAK) to transfer its operations. It noted at the time it was talking to two potential suitors, without naming them, who are willing to take over its subscriber base and assets.
Yesterday, Airtel Kenya said it was seeking approval from CAK to buy Yu’s licences and its 2.7 million subscribers, which would allow it to boost its market share to 27%.
Meanwhile, Safaricom revealed that it was in talks to buy some of the minnow’s assets. Local reports suggest that the leading operator will buy Yu’s network to improve the quality of its services.
With mounting losses and a market share of only 9%, as opposed to 67% for Safaricom, Yu Mobile has been struggling to survive.
The operator’s difficulties are not recent. Since it entered Kenya in 2008, its operations have been affected by an ongoing price war in the market. In 2012, it received Sh13bn (US$150m) from Indian parent company Essar to help pay off its debts.
Around the same time, local investors were reportedly looking to sell their 20% shareholding to Essar, which owns the remaining 80%, because of their inability to further invest into the business.
The country’s fourth and smallest mobile player is Telkom Kenya. Parent Orange is understood to be considering a sale of its unit but it remains unclear how news of Yu Mobile’s exit will now affect its plans.
