Thu. Dec 1st, 2022
Govt Reopens Bid to Partially Privatize Ethio Telecom

Govt Reopens Bid to Partially Privatize Ethio Telecom

The Government of Ethiopia has today reissued an invitation for Expression of Interest for the partial privatization of the state-owned telecom service provider Ethio Telecom.

The announcement comes on the same day the government kicked off a stakeholder consultation process to resume the issuance of the third telecom operating license.

Ethiopia first announced the beginning of the tendering process to sell its 40% stake in Ethio Telecom to an investor in July 2021, generating interest from some top global firms including France’s Orange.

Its officials, however, chose to put the partial sell-off of the telco on hold months later, to bid their time “to accommodate the improved macroeconomic situation as well as continually improving the financial performance of Ethio Telecom will result in better value for all the parties involved and in particular the citizens of Ethiopia”.

Briefing reporters today, Finance Minister Ahmed Shide said, after careful consideration of the market conditions and a very stable outlook of the country, the government is now ready to engage with prospective bidders to partially privatize 40% of Ethio Telecom’s share.

Accordingly, the government is reinitiating the process with the launching of the Expression of Interest that will permit prospective companies to express their interest, the Minister said.

Deloitte Consulting Ltd will be the transaction advisor representing the government that seeks to sell 40% of its stake in Ethio Telecom to a single investor. The government will retain 55% of the company, while 5% will be offered to local investors.

This partial privatization of Ethio Telecom and initiation of the stakeholder consultation process for the third telecom operating license are part of the government’s Telecom sector transformation plan, said State Minister of Finance Eyob Tekalegn.

The move, he said, aims to create a world-class telecom industry and enhance the country’s digital economy.

Authorities already awarded an operating license to a consortium led by Kenya’s Safaricom, Vodafone, and Japan’s Sumitomo.

The group paid $850 million for the license and their company, Safaricom Telecommunication Ethiopia plc, is now competing with Ethio Telecom after launching its national operation in Sept 2022.

Ethio Telecom generated 61.3 billion Birr in revenue in the 2021/22 fiscal year alone, and has nearly 67 million subscribers, covering more than half the population.

Source: Ethiopian Monitor.

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By Chala Dandessa

I am freelancer and Editor at ETHIOPIANS TODAY website. If you have any comment use caalaadd2@gmail.com as email contact. Additionally you can contact us through the contact page of www.ethiopianstoday.com. Twitter https://www.twitter.com/caalaadd Instagram: https://www.intagram.com/caalaadd Facebook: https://www.facebook.com/caalaaddofficial

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