LIBTELCO confirms Novafone acquisition and USD10m asking price

3 May 2016

The managing director of Liberian state owned fixed line incumbent Liberia Telecommunications Corporation (LIBTELCO), Sebastian Muah, has confirmed that his company has agreed a deal to acquire 100% of struggling Liberian mobile operator Novafone (formerly Comium Liberia) for around USD10 million. In a statement, he said: ‘The acquisition of 100% of the shares in Novafone means LIBTELCO can do what it needs to foster its commercialisation and strategies; and it means Novafone will continue to run, but with a new management team and direction.’ He went on to point out that Novafone is a ‘competitive asset’ that will allow his company to enter the mobile space with national coverage using a core network that has a viable long term lifespan. Muah says that LIBTELCO will invest upwards of USD5 million to build 100 cell sites on the Novafone network, suggesting that it will take up to two years to complete the full integration of the cellco.

‘Novafone has an active subscriber base of between 90,000 (based on 30 days) and 190,000 (over a three-month period). These subscribers pay on average USD3-USD5 per month. The asset’s valuation takes into account these customers,’ he said. ‘Despite all the challenges, Novafone’s revenue for the last two years exceeded USD4 million,’ the MD added. LIBTELCO aims to take a cellco that is not loss-making and accelerate its revenue growth over the coming years, with a focus on increasing the operation’s profit margin. ‘Since Novafone was not experiencing losses due to the decline in revenue, it continues to see increases in its operational costs. We also see it as a way to accelerate LIBTELCO’s market access immediately and not wait for 24 months down the road,’ he pointed out. Muah notes that his company’s operating licences are valid until 2030.

Liberia, Liberia Telecommunications Co (LIBTELCO), Novafone (formerly Comium Liberia)