Mobile operator Essar Telecom Kenya (Yu Mobile) is reportedly planning to finalise the sale of a stake in the company for Sh8.54bn (US$99.4m) in March in order to raise much-needed cash.
The company is holding discussions with several international…
Mobile operator Essar Telecom Kenya (Yu Mobile) is reportedly planning to finalise the sale of a stake in the company for Sh8.54bn (US$99.4m) in March in order to raise much-needed cash.
The company is holding discussions with several international firms, according to Essar Kenya CEO Madhur Taneja, quoted in local publication Business Daily. He declined to disclose the name of the buyers or the size of the stake.
The operator, currently 80%-owned by Indian conglomerate Essar, is reportedly looking to raise US$150m for operational costs and capex.
Late last year, local investors said they would sell their 20% shareholding to Essar because of their inability to invest further into the business. However the share transfer has been partly delayed by the conclusion of the US$100m deal, Taneja told Business Daily.
Yu Mobile, which entered Kenya in 2008, has been affected by an ongoing price war in the mobile market. Last year, it received Sh13bn (US$150m) from Essar to help pay off its debts
The telco’s market share stands at approximately 10% against 65% for Safaricom, Kenya’s leading operator.
In June 2013, Yu was reported to be looking for strategic investors to help raise funds to pay its suppliers.
At the time, Viettel was rumoured to be among the interested parties. The Vietnamese company is already present in Mozambique and has a licence to operate in Cameroon. It is also looking to enter Burkina Faso.
