Airtel Prematurely Pulls Out of Merger Talks with Telkom Kenya

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Airtel Kenya
Image Courtesy AFP
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Airtel Kenya has disappointed quite a number of people, including senior Ministry of ICT and Treasury officials as well as Telkom Kenya shareholders after the company walked away from merger talks with Telkom Kenya.

Apparently, Airtel lost interest in the talks after Telkom Kenya started making structural changes that left Airtel feeling like it was getting into bed with a shell. Telkom Kenya recently announced that is was selling 723 cell towers to the American Tower Corporation (ATC), a move that we thought was meant to raise money to appease Airtel but Little Red doesn’t see it that way.

It is also believed that Helios and the Government of Kenya (owners of Telkom Kenya) are looking to set up a new entity that would manage Telkom’s real estate assets, leaving Telkom Kenya mobile operations with very minimal assets.

This move is what has supposedly given Airtel cold feet who now prefers leaving things as they are with Telkom Kenya tailing them as the third mobile network operator by subscriber count.

The Standard also reports that the merger deal could have been sabotaged by external forces or Airtel might have found a better suitor to take over its business in Kenya. The fallout has happened in the early stages of the talks since neither of the two companies involved had reported the merger to the Communications Authority of Kenya.

“They had not officially requested us to approve a merger transaction … we heard about the merger but later also heard that Airtel had pulled out but they never came to us,” Communications Authority of Kenya (CA) Director General Francis Wangusi told Weekend Business.

If Airtel and Telkom went ahead with the merger, they would have a better chance to stand against Safaricom that commands a significant share in the telecommunications market. There’s no official comment from both parties, but there’s still a grey area that Airtel might eventually exit the Kenyan market despite the company dismissing the claims as “devoid of facts” a few months ago.

Read More: Airtel Terms Reports of Exit from Kenya, Tanzania and Rwanda as “Devoid of Facts”

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