Millicom announced that it has signed an agreement to sell its Rwanda operations to subsidiaries of Bharti Airtel Limited as the latter reiterated its commitment to a number of African markets following speculation about its plans.
“The sale of our business in Rwanda is in line with our strategy to focus on providing advanced fixed and mobile data services in Latin America,” commented Mauricio Ramos, CEO of Millicom.
“We are very grateful to the government of Rwanda for their support throughout the last eight years, which allowed us to extend digital inclusion to thousands of Rwandans. We are also very grateful to all our employees, whose drive and commitment enabled Tigo Rwanda to become a leading provider of digital services in the country. We are confident that Bharti Airtel will build on the strength of Tigo Rwanda and enhance the services provided to customers”, he added.
The total consideration of the transaction is approximately 6x 2017 adjusted EBITDA, payable over two years, consisting of a mix of cash, vendor loan note and earn out. The transaction is subject to regulatory approvals.
Sunil Bharti Mittal, chairman of Bharti Airtel, said that “Airtel has taken proactive steps in Africa to consolidate and realign the market structure in the last few remaining countries where its operations are lagging on account of lower market share and presence of too many operators. Airtel and Tigo [Millicom’s African brand] have already merged their operations to create a strong viable entity in Ghana. Today it has taken yet another important step to acquire Tigo Rwanda to become a profitable and strong challenger in a two-player market.”