The country’s telecommunications sector is set to witness a major transformation as owners of two of the major players in the industry are set to merge.
Bharti Airtel, owners of Airtel Ghana, is reportedly in talks with rival company, Millicom International Cellular, operators of tiGO in Ghana, for a possible merger in Ghana. Although the full amount involved in the deal is not yet known, the move comes as India’s number 1 telecom operator which is embroiled in what has been described as a brutal tariff war in its home market, tries to find ways to improve operations in Africa where it has yet to make a profit since entering the continent way back in 2010.
Impact on the Telecoms Industry
When consummated, the merger would see the combined entity overtaking Vodafone Ghana to become the second largest telecom operator in Ghana. Presently, South Africa-based MTN Ghana has the biggest market share in a highly competitive telecom industry dominated by multinationals. “The two companies are in discussions for a possible joint venture wherein both companies could hold equal share,” a source who confirmed the talks to ET, a reputable Indian telecoms newspaper, said.
While Airtel declined to comment on the talks in Ghana, Millicom, which operates under the brand of tiGO in five African markets including Ghana, didn’t respond to an email seeking comment.
Stakes in the Telecoms Industry
Airtel Ghana contributes 6-7 per cent to Bharti Airtel’s Africa revenue, which totaled close to US$900 million for the July-September quarter. Net loss for Airtel’s Africa operations narrowed during the quarter to US$91 million from US$170 million a year earlier. Ghana is Tigo’s second largest market by subscribers.