Safaricom downplays claims that it is opposing Airtel, Telkom Kenya merger again

October 23, 2019 (4 weeks ago)
“We are not objecting to the merger, yeah in fact I think my predecessor even said he welcome the merger. Am not so sure in the best interest of Kenyans but nevertheless, the only reservation we have is that we have equitable distribution of spectrum which is fair.”/FILE

, NAIROBI, Kenya, Oct 23 – Giant mobile service provider Safaricom has downplayed claims that it is opposed to the proposed merger deal between Airtel and Telkom Kenya, which is expected before the end of the year. 

Safaricom Interim CEO Michael Joseph says it does not oppose the move but wants the issue of frequency allocation to be re-balanced.

According to Joseph, Safaricom to lobbying for equal distribution of spectrum, which is currently imbalanced.

Last month, Joseph stated that there would be an imbalance post-merger if the issue is not looked at Airtel-Telkom will jointly hold 77.5 MHz of spectrum against a customer base of 17.3 million, compared to Safaricom’s 57.5 MHz with almost double the customer base at 31.8 million.

“We are not objecting to the merger, yeah in fact I think my predecessor even said he welcome the merger. Am not so sure in the best interest of Kenyans but nevertheless, the only reservation we have is that we have equitable distribution of spectrum which is fair,” he said.

Airtel and Telkom Kenya yesterday told the Senate Committee on ICT that the merger plans which was mooted in February now awaits approval by the Cabinet.

The new Airtel-Telkom outfit is meant to bring together certain aspects of each business specifically the mobile, enterprise and carrier services businesses. It will not, however, benefit from some of the assets that its predecessors had including telecommunication masts.

Telkom Kenya’s prime real estate portfolio and specific Government services will not form part of the combined entity.

Telkom will be counting on the merger plans with Airtel to take on Safaricom and end its loss-making streak.

Should the merger get the necessary approval, the entity, ‘Airtel-Telkom’, will create a stronger challenger to Safaricom’s 65 percent market share that has curbed competition.

As of March, Telkom accounted for 7.9 percent of the country’s mobile telecom subscribers, behind Airtel’s 26.1 percent which ranks second.

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