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Essar not going ahead with Africa telco deal

Essar not going ahead with Africa telco deal
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First Published: Wed, Jun 15 2011. 12 32 PM IST
Updated: Wed, Jun 15 2011. 12 32 PM IST
Mumbai: Indian conglomerate Essar Group has decided against buying into Dhabi Group’s telecom business in Uganda and Congo, the Indian group said on Wednesday, but denied a newspaper report that it was looking to sell its telecom operations in Kenya.
Essar had in 2009 agreed with Dhabi Group to buy a majority stake in Warid Telecom Uganda and Warid Congo SA, which it said had an enterprise value of $318 million. Essar had not disclosed how much it was paying for the stake.
“It was mutually decided between the partners - Essar and Warid Group - not to proceed with the deal closure as certain condition precedents pertaining to government clearance were not met,” Essar said in a statement.
The Economic Times newspaper earlier reported Essar had decided not to go ahead with the agreed acquisition in Uganda and Kenya.
The paper also cited two unnamed sources saying Essar was looking for a buyer for its telecoms operations in Kenya and that it would be willing to sell the business for about $300 million.
Essar said it was not evaluating any sell off options in Kenya.
“Essar remains committed to the African market and is satisfied with its operations in Kenya,” it said in a statement.
Essar Group, controlled by Indian billionaire brothers Shashi and Ravi Ruia, owns 33% in an Indian mobile joint venture with Vodafone, but has agreed to exit the joint venture.
Vodafone is paying a predetermined price of $5 billion to buy Essar out of Vodafone Essar to give it direct ownership of 75% of India’s third-biggest operator.
Essar Group also controls London-listed Essar Energy and has interests in steel, ports and logistics.
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First Published: Wed, Jun 15 2011. 12 32 PM IST