Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.


Millicom Signs New Sales Deal for Tigo Senegal

Article Image
International telecom operator Millicom said it terminated its agreement to sell its Tigo Senegal operation to Wari Group, and instead signed a new sales deal with a consortium that includes Xavier Niel's private holding company, NJJ Capital.

Millicom International Cellular SA (Nasdaq: MICC) told Connecting Africa that Wari had failed to secure financing needed for the deal but that a rival offer from a consortium -- involving NJJ, Sofima (a telecom investment vehicle managed by the Axian Group) and investment holding group Teylion -- would allow it to proceed with the sale.

"Wari has not provided the financing required for the deal, thereby not meeting the terms of the Sales and Purchase Agreement (SPA) further to which we are exercising our right to terminate the transaction," said a spokesperson for Millicom in comments emailed to Connecting Africa. "The telecom consortium approached us with an alternative offer that provides continuity to the transition process started back in February this year."

Millicom would not disclose details of the price that NJJ has agreed to pay for Tigo Senegal, although it would have received $129 million under the original deal with Wari.

Niel is a well known figure on the European market as founder of French operator Iliad (Euronext: ILD) and the Free brand, and is known to be looking to diversify his portfolio. Iliad plans to launch an operator in Italy this year, for example, and has also invested in Switzerland, Monaco and Israel. Early in 2016, NJJ also acquired a minority stake in Alliance Miniere Responsable (AMR), a Paris-based company developing bauxite reserves in Guinea. Iliad has also launched a mobile service under the Free brand in Reunion, using the network of Telco OI -- co-owned by Iliad and Axian.

Axian Group (formerly the Hiridjee Group), meanwhile, is active in the areas of telecom, financial services and real estate in Africa and the Indian Ocean, with telecom activities including the operator Telma in Madagascar, Towerco of Madagascar (TOM), Télécom Réunion Mayotte (TRM) and Telecom OI.

Millicom has operations across Africa and Latin America, with the core of its business focused on the latter. In Africa, specifically, Tigo operates in Ghana, Tanzania, Rwanda and Chad and, until recently, was active in Senegal. Besides the deal to sell its operations in Senegal, it is also looking to offload its stake in Helios Towers Africa and has agreed to combine its operations in Ghana with those of Airtel. Once that deal has received regulatory approval, each company will have equal ownership in the resulting joint venture.

Like other service providers with pan-African operations, such as Orange (NYSE: FTE) and Airtel Africa, Millicom had recently been reporting improved financials for Africa while also restructuring its operations on the continent, leading to speculation that it may also be considering an exit altogether. (See Airtel Africa Provides Some Solace for Bharti in Q1, African Revamp Has Paid Off, Reports Airtel, Orange Buys Airtel Ops in Burkina Faso, Sierra Leone, Orange Trumpets Africa Boost in Q2 and Millicom Africa Exit on the Cards After Positive 2016.)

But after providing a positive update on the state of its overall business for 2016, Millicom painted a less positive picture for the second quarter of 2017 and said its primary objective for Africa in 2017 "is to ensure that the region can fund itself going forward. We remain confident that we will achieve this goal in 2017 notwithstanding the challenging operating conditions that we have seen year-to-date."

In the second quarter, Millicom added 149,000 mobile subscribers in Africa, "ending the period with 21.7 million mobile subscribers in Africa and reversing the net losses experienced in recent quarters largely due to the impact of SIM electronic registration requirements implemented in Tanzania during 2016." All figures for the second quarter excluded the Senegal operations.

However, it said overall market conditions "remain extremely challenging in Africa," and that service revenues contracted by 6.2% to $172 million in the second quarter, after declining 3.6% in the first, with growth lower in the second quarter than in the first in every one of its markets except Ghana. EBITDA in Africa also declined 18% year-on-year to reach $47 million. It ended the quarter with 21.7 million mobile subscribers in Africa after adding 149,000 mobile subscribers, "reversing the net losses experienced in recent quarters largely due to the impact of SIM electronic registration requirements implemented in Tanzania during 2016."

— Anne Morris, contributing editor, special to Connecting Africa

Innovation hub


KaiOS targets merchant market for growth, digital inclusion

KaiOS Technologies, the creator of a mobile operating system for smart feature phones, is piloting affordable merchant payment terminals - which look like feature phones - in Africa to help underserved merchants and transport providers accept digital payments solutions.


Ilara Health aims to improve quality of care in Kenya

Kenyan healthtech startup Ilara Health aspires to improve the quality of care in the country's clinics by providing equipment financing and digitizing facilities with its software.

More Innovation hub

Latest video

More videos

Guest Perspectives


Leadership Lessons: The importance of mentorship for career growth

By Nollie Maoto

Nollie Maoto, First Rand Group's compliance chief data and analytics officer and Africa Tech Festival Leadership Council member, reflects on the importance of mentorship for career growth for African women in data analytics.


Omdia View: May 2024

By Omdia Analysts

May 2024's telecoms highlights in the Middle East and Africa included African 5G subscriptions surpassing 5 million, growth from SpaceX's satellite Internet service Starlink, and a major fiber partnership in the Middle East and North Africa.

More Guest Perspectives

Sponsored video

More videos

Industry announcements

More Industry announcements

Upcoming events

Cyber Revolution Summit
August 9, 2024
Gaborone, Botswana
Africa Tech Festival 2024
November 12-14, 2024
Cape Town, South Africa
More Upcoming events

Africa Tech Perspectives


Uber's Marjorie Saint-Lot on inclusion and sustainability in Africa

Uber's Country Manager for Ghana and Cote d'Ivoire, Marjorie Saint-Lot, shares how the ride-hailing company is approaching public-private partnerships, environmentally friendly initiatives and gender inclusion in Africa.


The 100 most influential African leaders in 2023

A new report from Africa Tech Festival and Connecting Africa puts a spotlight on the top 100 African leaders in the telecoms and technology sector in 2023.


Deep dive into East Africa's tech startup ecosystem

New survey reveals a lack of access to investors, reliance on international VCs and global recession trends as the biggest barriers for East African tech startups to access funds.

More Africa Tech perspectives

Partner perspectives

All Partner Perspectives

Follow us on X

Like us on Facebook

Newsletter Sign Up

Sign Up
Tag id test-002