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Thursday, July 2, 2015

ORANGE BIDS FOR AIRTEL FRANCOPHONE BUSINESS

Airtel's rumoured Africa exit seems more imminent daily with industry rumours indicating that Orange has bid for its DRC, Gabon and Chad business units.

Insiders say the Indian headquarters of the Bharti Airtel Group are fed up with the inability of the African business to break even five years after its entry into the continent via a buyout of the Zain Group.

Nomura Singapore stock analysts are reported to have said in a note to investors that the Airtel's African business has a negative (-2%) return on invested capital and that shows no signs of changing.

They advised that Airtel should sell. Yesterday, Airtel told Indian regulators that it has sold its Cell phone towers in 5 African countries for US$1.3billion.

In the first three months of this year, it saw its African revenues drop 13 per cent compared to the first three months of 2014 while its net loss in Africa stood at $183million (Sh18.2bn)

Orange on the other hand, is said to be looking to amalgamate its emerging markets business under Orange Africa and was reported by Reuters to be also looking at Millicom International Group's assets.

Meantime, at Parkside Towers, where Airtel runs its African business from, more heads continue to roll as it cuts what it deems are unnecessary big-salaried positions.

The company is yet to issue an official statement on the matter.

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