India’s Essar Group has begun discussions with UAE-based Dhabi Group, an investment firm led by the Abu Dhabi royal family, with a view to investing in African telecoms assets, the Economic Times is reporting. Commenting on the development the Essar Group released a statement noting: ‘The transaction will involve an equity infusion into these businesses (of the Dhabi Group’s Warid Telecom subsidiary), as growth capital. It will be the basis of a partnership to create a significant presence in Africa.’ Vikash Saraf, Essar Group’s director of strategy and planning, added: ‘We are running exclusive discussions and will decide on our investments after eight to twelve weeks.’ The two companies are understood to have signed a preliminary agreement already, with Standard Chartered Bank acting as financial advisor to the Dhabi Group.
Through Warid Telecom, the Dhabi Group already has operations in Africa, including Congo, Cote d’Ivoire and Uganda. The Essar Group, meanwhile, has launched commercial services in Kenya in partnership with Econet Wireless, through holding company Essar Telecom Kenya, and has received a concession to offer mobile services in Uganda, although it has yet to launch there.