The Orange Group has signed a binding agreement with Helios Investment Partners for the sale of its entire 70% stake in Telkom Kenya. The stake is owned by France Telecom.
The company said in a press release the finalisation of the transaction is, however, subject to approval from the relevant authorities. “This signature,” the statement says, “reflects Orange’s constant focus on optimising its portfolio of assets.”
The group says the Africa and Middle-East region is a strategic priority for it. Telkom is Kenya’s incumbent fixed-line operator and is third placed in the mobile market behind leader Safaricom and Airtel.
See also: Broke Telkom Kenya begins to sell its assets to raise capital
The company, which operates a high-quality mobile data network, had four million mobile customers at the end of June 2015, up from 3.7 million in the previous quarter, according to figures published by the Communication Authority of Kenya, but has been struggling to make a profit in the highly competitive market.
Safaricom commands the mobile industry with close to 70% of market share followed by Airtel with about 20%. India’s Essar Telecoms, operating as yu, sold its Kenyan business, Yu, last year after it failed to make it profitable.
National Treasury Cabinet Secretary Henry Rotich Tuesday says it would determine whether it will retain its 30% stake or sell part of it. Orange paid $390 million for its stake in 2007, aiming to capitalise on what were fast growth rates in the sector. The plan was to make the firm, then known as Telkom Kenya, profitable and then to take it public in five years.
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