COMPANIES have 30 days from today to tell the government of Ethiopia if they are interested in buying a 40 percent stake in state-owned Ethio Telecom, tech news portal Capacity Media reported on Tuesday.
At the same time the government confirmed that Deloitte will be the lead transaction adviser, and is in the final stage of completing the preparatory work. This includes the business plan, financial, legal and tax due diligence, and business valuation of the company, led for the past three years by Frehiwot Tamiru (pictured).
Today’s request for expressions of interest ‘will allow international investors to express interest in acquiring a stake in Ethio Telecom, one of the largest telecom operators in Africa,’ said the Ministry of Finance in Addis Ababa.
After expressions of interest, the next stage is a request for proposals, said the ministry. The timeline for this “will be communicated in due course, with the aim of completing the transaction in an efficient and streamlined manner”.
The move comes just days after a Vodafone-led consortium received its licence to compete against Ethio Telecom, for which it paid $850 million. The group, which includes Kenya’s Safaricom and South Africa’s Vodacom as well as Sumitomo of Japan and government funding agencies from the US and UK.
The Global Partnership for Ethiopia, as it is officially called, will spend $8bn on building out its network, prime minister Abiy Ahmed said last month.
The Ministry of Finance and the Public Administration and Enterprise Management Agency (PEHAA) said the launch of the Ethio Telecom privatisation represents an important step in the process of liberalising the national telecoms market initiated since 2018 by the government.
Reports from Addis Ababa say that a sale of a second telecoms licence is already in preparation. South Africa’s MTN offered too little, at $600 million, to secure a licence in the last round.
It is being suggested however that MTN might choose to invest in Ethio Telecom instead. Orange is also believed to be looking at that option: it once had a management contract for Ethio Telecom.