MUMBAI: Telecommunications services provider Bharti Airtel Limited, through its subsidiary Airtel Rwanda, has entered into a definitive agreement with Millicom International Cellular S.A. to acquire 100 per cent equity interest in Tigo Rwanda.
The acquisition will consolidate the Rwandan telecom market and position Airtel as a strong operator in Rwanda. The acquisition cost is approximately six times EBITDA multiple payable over two years.
Bharti Airtel chairman Sunil Bharti Mittal said, "Airtel has taken proactive steps in Africa to consolidate and realign the market structure in the last few remaining countries where its operations are lagging on account of lower market share and presence of too many operators. Airtel and Tigo have already merged their operations to create a strong viable entity in Ghana. Today, it has taken yet another important step to acquire Tigo Rwanda to become a profitable and a strong challenger in a two-player market.”
Mittal added that Airtel Africa was committed to the long-term viability of the operations in Kenya and Tanzania to ensure that in 2018 all its 15 operations in Africa started contributing positive margins and cash flows towards a healthy and profitable Airtel Africa.
The agreement aims to bring together the strengths of Airtel and Millicom in Rwanda and offer benefits to customers in the form of a wider network and affordable voice and data services. The existing customers of Tigo Rwanda will join Airtel's global network, which currently serves over 370 million customers across 17 countries.
Airtel Africa MD and CEO Raghunath Mandava said, "The acquisition reinforces our commitment to the Rwanda market and is a significant step towards creating a stronger presence in the country. It will create synergies with our existing business and help boost operational efficiencies in the market. The Rwandan telecom market will significantly benefit from this acquisition, further reiterating our stand that in-market consolidations do not just help achieve better market positions but benefit customers and the industry as a whole."
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