Bharti Airtel and rival Millicom International Cellular are in talk about the possibility of a fusion between the two entities in Ghana. The Indian No.1 telecom is still in the brutal price wars back home and has to find a new market in Africa.
Even though the company is present on the continent since 2010 no profit has been recorded so far. This merge would have consequences for another competitor Vodafone which would become No.2 in Ghana instead of being 1st. This new merge would not be something new for the Indian firm since its recent merge with Axiata which has been accepted under which the Indian telco owns a 25 per cent stake in the combined entity with the partner holding more than 68 per cent.
Airtel Ghana contributes 6-7 percent to Bharti Airtel’s Africa, which amount for US$ 900 making Airtel’s Africa loss for only US$ 91 million compared to US$ 170 million the year before. According to Ghana’s National Communication Authority, Airtel held 15.71% of the market and Vodafone 17.91%.
Turning around Africa is more important for the company faced with severe financial pressure from main competitor Reliance Jio which has been playing with an aggressive price war since its creation last year.
Besides exploring consolidation possibilities in Africa where it has already sold most of its towers and operations in Burkina Faso and Sierra Leone to France’s Orange Telecom, Airtel is looking to raise funds by selling stake in its tower unit, Bharti Infratel, and via a bond issue.