Telecom major Bharti Airtel on Tuesday said that it has signed an agreement with Millicom International Cellular S.A. to acquire 100 per cent stake in its Rwanda operation which operates under the brand name of Tigo Rwanda.
"Bharti Airtel Limited...has entered into a definitive agreement with Millicom International Cellular S.A. (Millicom) under which Airtel Rwanda Limited will acquire 100 per cent equity interest in Tigo Rwanda Limited," Bharti Airtel said in a statement.
Under this deal, Tigo's 370 million customers will join the network of Airtel Rwanda. The acquisition will make Airtel Rwanda the second largest operator in the country with revenues of over USD 80 million and a revenue market share of over 40 per cent, the statement said.
"The consideration for the transaction is based on approximately 6x EBITDA multiple, payable over two years. The agreement is subject to regulatory and statutory approvals," the statement said.
Airtel at present operates in 15 African countries apart from India and South Asia. "Airtel and Tigo have already merged their operations to create a strong viable entity in Ghana.
It has taken yet another important step to acquire Tigo Rwanda to become a profitable and a strong challenger in a two-player market," Bharti Airtel Chairman, Sunil Bharti Mittal said. In the past, Airtel acquired assets in Uganda (Warid) and Congo B (Warid), Kenya (yu Mobile) and consolidated operations in Ghana (Millicom).
"We are also committed to the long term viability of our operations in two other countries i.e. Kenya and Tanzania, to ensure that in 2018 all our 15 operations in Africa start contributing positive margins and cash flows towards a healthy and profitable Airtel Africa," Mittal said.
Airtel is one of the largest telecom service providers across the continent in terms of geographical reach and had close to 83 million customers at the end of quarter ended September 30, 2017, the statement said.