Regulator to clear Telkom Kenya sale after payment of debt

8 Mar 2016

Francis Wangusi, Director-General of Kenya’s Communications Authority (CA), has disclosed that the authority has received a letter from Orange requesting the transfer of its shares in Telkom Kenya to African private equity firm Helios Investment Partners, the Daily Nation writes. However, the official stated that the CA will grant its approval to the transaction only after Orange’s debt of KES1.5 billion (USD15 million) in licensing and spectrum fees for the period 2014-2016 is cleared. Wangusi added that the struggling telco will be issued with another invoice for unpaid licensing/spectrum fees worth nearly KES800 million in July; the regulator is reportedly also considering to impose penalties for ‘misuse of frequency and failure to meet set quality standards’.

As previously reported by TeleGeography’s CommsUpdate, in November last year the French company announced the signing of an agreement with Helios for the sale of its entire 70% stake in Telkom. Under a new deal that has been negotiated as part of Orange Group’s planned exit from the country, the Treasury of Kenya and Helios entered discussions in early 2016 for a 10% stake in Telkom, with the treasury aiming to increase its stake in the Kenyan firm to 40%. The government will not pay any money for the additional 10% stake, but instead has agreed not to exercise its pre-emptive rights to buy Orange’s 70% shareholding.