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More Africa NewsMobile networks silent on Orange entry into South Africa

June 29, 2020by myles0
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South African mobile networks refuse to be drawn into discussing the prospect of French telecommunications giant Orange entering country.

This follows comments by Orange CEO Stéphane Richard, who was speaking to French newspaper Les Echos.

“It could make sense for Orange to have a larger African geographic base than today and to be present in the large African economies of Nigeria and South Africa, ” said Richard.

Richard said that the company’s consideration of such a move is because Orange needs to be more aggressive in its strategy.

“A crisis creates problems but also causes opportunities,” said Richard.

“Orange must put itself in the spirit of seizing these opportunities.”

South African mobile networks decline to comment

South African mobile networks chose not to comment on the comments made by Richard.

“Cell C is focused on its turnaround strategy and we do not comment on speculation,” said Cell C.

Vodacom and MTN also declined to comment.

Likewise, when Richard was asked by Les Echos specifically about interest in MTN Group, he too declined to comment.

According to Richard, if Orange decides to make a move in the South African market, it would not take a long time before such a plan would be executed.

“If one considers there are things to do, the time frame I am considering is rather a few months than a few years,” Richard said.

Expanding its African business

Orange’s expansion strategy in the African market is not new.

In January 2020, Orange hired advisors – BNP Paribas SA and Morgan Stanley – to provide the telecommunications giant with advice regarding a possible initial public offering (IPO) of its Middle-East and Africa business.

An IPO was a vehicle through which the company could attain growth, and Orange evidently continues to investigate other strategies to drive growth in the Middle East and Africa region.

In 2018, Orange’s Middle East and Africa business reported $1.8 billion in adjusted earnings before interest, taxes, depreciation, and amortisation.

Orange is also reportedly considering its options in smaller African regions and has shown an interest in the ongoing telecommunications privatisation process that is taking place in Ethiopia.

The Ethiopian government has put a minority stake in state-owned Ethio Telecom up for sale, and is also selling two new licenses, Bloomberg reported.

This move is designed to attract foreign investment and improve competition and, by extension, the quality of the sector.

“It is very encouraging for us to see several companies pulling together resources that will be required to acquire these valuable spectrum licenses,” said Ethiopian finance ministry adviser Brook Taye.

“Having a consortium of companies coming in and showing interest is a great testament to the appreciation of the value of these spectrum licenses.”

Both Vodacom and MTN are also reportedly looking into Ethiopia’s privatisation process.

Source: My Broadband

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