Telecom major Bharti Airtel on Wednesday announced selling of its operations in Sierra Leone and Burkina Faso — both African countries — to Orange, a France-based telecom company, which will acquire 100% of the two companies’ share capital.
Bharti Airtel in a statement said, “Orange and Bharti Airtel International (Netherlands) BV have signed an agreement leading to Orange’s acquisition of Airtel’s operations in Burkina Faso and Sierra Leone”. The consolidated revenue of the two companies is around 275 million euro (Rs 1986.6 crore).
The net debt of the company at the end of second quarter ending September 2015, stood at Rs 70,777 crore.
Airtel said that the outlay for Orange for these transactions will be based on the financial of its two subsidiaries for the year ended March 31, 2016 and will represent the equivalent of 7.9 times Airtel’s EBITDA in these two countries at this time.
In July 2015, Bharti Airtel had announced entering into an agreement with Orange to sell its four subsidiaries Burkina Faso, Sierra Leone, Chad and Congo Brazzaville in Africa. The agreements for the remaining two countries have however lapsed.
This is further to the initial agreement signed between Airtel and Orange in July 2015 regarding the potential acquisition of Airtel’s operations in Burkina Faso, Sierra Leone, Chad and Congo Brazzaville, Airtel said.
The company said the completion of these transactions remains subject to approval by the competent authorities.
Through this deal, Orange will reinforce its presence in Africa with two additional countries, adding almost 5.5 million customers to its mobile customer base.
These acquisitions will be implemented in partnership with Orange’s subsidiaries in the Côte d’Ivoire and Senegal.
This acquisition marks a step forward in Orange’s growth strategy and will bring the Group’s African footprint up to 20 countries in 2016.
In order to reduce debt, Bharti Airtel in October 2015 completed the sale of about 8,300 mobile towers in Africa for $1.7 billion (about Rs 11,000 crore).