NAIROBI, Kenya, Jul 29 – The new ownership structure of the East African Marine Systems (TEAMS) could be identified by Friday this week.
This is after four firms that were initially to buy equity in the government-sponsored fibre optic cable failed to meet the July 14 deadline to pay up for their shares.
Safaricom CEO Michael Joseph says that according to a Memorandum of Understanding (MOU) signed by partners in the company the shares that are not paid for will first be offered to current shareholders before being offered to any other interested parties.
“According to the Memorandum of Understanding that we signed, what it states is that if any companies did not meet the deadline for payment, the shares will be offered to other shareholders in proportion to their current shareholding,” Mr Joseph said
“If shareholders don’t take up all the shares after the given time, the remaining will then be offered to the other shareholders as well, if the shares are still not fully taken up, that’s when outsiders will come in, something I see highly unlikely,” said Mr Joseph on Wednesday.
Paying for the equity contribution was one of the legal requirements for shareholders within the company in which the government held 85 percent of the shares, which were to be offered to private sector, while Etisalat, a United Arab Emirates telecoms company holds 15 percent.
Four companies, Flashcom, Africa Fibrenet Uganda, Iquip Limited and Inhand, which had expressed interest to buy a combined shareholding of 5 percent at 1.25 percent each failed to meet the deadline.
Among the companies that have taken up 95 percent of the shares are Safaricom and Telkom Kenya (20 percent each), Essar Telecom Kenya and Kenya Data Network (10 percent each).
Speaking while presenting a Mercedes car to Humphrey Kimani a second year Acturial student at Jommo Kenyatta University who won it in the on- going promotion dubbed “Activate your Drive” Mr Joseph said the cable will be going commercially live by the end of August.
“I think we start to do some live testing today or tomorrow (Wednesday or Thursday). The contractors – Alcatel Submarine Networks – who are laying the cable want to do mere test for another four weeks before handing it over to us,” he said
Mr Joseph expressed confidence that TEAMs market share would not be threatened by the fact that the SEACOM went live on Thursday and becomes the first cable to do so.
He however observed that the demand for data services from Safaricom went up by between 15 and 20 percent last weekend as a result of the going live of the SEACOM cable.
In the meantime the CEO was insistent that the prices of data services will not go down drastically overnight as a result of the going live of the two cables in the country.
For instance if you are a big corporate and you are using a big pipe, I do see big reductions, but if you are a person using just a little bit of data, I don’t see massive reductions coming,” he said.