Millicom’s ‘Plan A’ for Africa will see it “continue to improve on its market position and revenue,” said CEO Mauricio Ramos. He described this week’s agreed sale of the Democratic Republic of Congo (DRC) business to Orange as “Plan B”.
Millicom’s (STO:MIC) ‘Plan A’ for Africa will see it “continue to improve on its market position and revenue,” said CEO Mauricio Ramos.
Speaking on the company’s FY 2015 conference call, Ramos said that this week’s agreed sale of Tigo in the Democratic Republic of Congo (DRC) to Orange was “Plan B”.
“In this case, it was a better outcome than Plan A. We have a buyer with in-market synergies, so it was a pretty good price [US$160m in cash] for us, and for them.”
Appointed last August, Africa CEO Cynthia Gordon (pictured) is “squarely focused on [Plan A], and we remain focused on good capital allocation,” said Ramos.
The Sweden-based company is also present in Chad, Rwanda, Senegal and Tanzania, and acquired Zantel from Etisalat last year.
Asked whether the DRC sale was indicative of an allocation of capital away from Africa, Ramos responded that the company looks at all assets on an individual basis.
“We need to look at where we are sub-scale, even if a business is run well, and that kind of thinking will inform our decisions in both Latin America and Africa,” he said.
In 2015, Millicom increased its mobile subscriber base by 6 million to reach 63 million, with 30% data penetration, while in cable it reached 7.6 million homes passed. Its FY 2015 revenue was US$6.73bn, which represented an organic growth of 7.4%; and an adjusted EBITDA of US$2.27bn, representing an organic growth of 9.2%. Its year-end net debt stands at US$4.3bn, with US$225m maturing in 2016.