Kenyan mobile operator Safaricom said this week that it could withdraw an offer to acquire assets owned by Essar Telecom Kenya, as there has been no regulatory certainty or clearance regarding the matter.
“For all concerned, this transaction was very time-bound. We are giving very serious consideration to pulling out for the simple reason that the lack of regulatory certainty puts us in a place where the key fundamentals of the transaction have changed,” said Corporate Affairs Director Nzioka Waita.
The purchase of Essar assets was subject to clearance by the Communications Authority of Kenya (CAK), but the regulator is yet to acknowledge receipt of the application.
If the proposed Essar Kenya deal succedes, Safaricom will acquire Essar’s network base stations and transmission equipment, while rival Airtel Kenya acquires Essar’s 2.75 million subscribers and licenses.
According to Bloomberg, “Before agreeing to a deal with Safaricom and Airtel, Essar approached Orange SA (ORA), Emirates Telecommunications Corp. (ETISALAT), MTN Group Ltd. (MTN) and a Vietnamese telecommunications company over the past 18 months about a possible acquisition.”