Ethiopia shifts sale focus to local investors

Ethiopia shifts sale focus to local investors

Ethiopia halted the sale of shares of its state-owned operator Ethio Telecom to foreign companies, to prioritise domestic retail investors instead, reported Bloomberg.

The government wanted to sell 45% of Ethio Telecom to foreign investors in a move to keep the operator competitive against Safaricom. French operator Orange, which has a substantial footprint in Africa, announced it withdrew from the bidding process as it did not gain assurances to deploy its strategy in the populous 120 milliion strong country. Speaking to Developing Telecoms at MWC Barcelona, Orange MEA boss Jerome Henique said the group is still open to do a deal.

“There were bidders, but each one of them has left the process at one point,” said Abdurehman Eid, chief executive officer of Ethiopian Investment Holdings, which is handling the process along with the finance ministry. “At the end, we felt it’s probably better to halt the process.” 

The chief executive said foreign bids did not meet state expectations in an interview last week with Bloomberg.

Eid added that Ethiopia will push to sell a 10% stake to retail investors who are “showing appetite. But a sale to foreign investors is not off the table as the process will resume after the company lists on the Ethiopian Securities Exchange that starts operations in October.

Ethiopia worked to open its economy to foreign investment and firms since 2018. According to Bloomberg, Ethio Telecom had 74.6 million subscribers in January and reported 11 billion birr ($191.6 million) profit its H1 results. 

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