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More Africa NewsEthiopia: Partial privatization of Ethio Telecom scheduled for the next 6 months

February 22, 2021by myles0
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In 2019, the government of Ethiopia initiated an economic reform program. It makes the opening of the capital of several public companies, in particular Ethio Telecom, a condition of its success.

In an interview with the Ethiopian News Agency on Wednesday February 17, 2021, Biruk Taye, senior adviser to Ethiopia’s finance minister, announced the partial privatization of Ethio Telecom in the next six months. He indicated that the government was currently finalizing the launch of this operation which would see 40% of the capital of the incumbent operator acquired by an international company while 5% would be offered to citizens.

Biruk Taye pointed out that when the process of privatizing Ethio Telecom comes to an end, the government will also have already identified the two companies that will compete with the public company in the domestic market. The call for proposals for the acquisition of the two telecom licenses is still in progress. It will end on April 5, 2021.

The government’s final adjustments before the launch of the privatization process of Ethio Telecom are continuing in parallel with the financial estimate of the public company, entrusted last January to the firm KPMG East Africa. The eight-week operation is expected to end by March 2021.

The financial assessment obtained, combined with that entrusted to the firm Deloitte hired by the Ministry of Finance as advisor in privatization transactions, will help to better understand the real value of the company with regard to the new market segments in which it will soon enter. get started.

The successful privatization of Ethio Telecom by September 2021 will allow the state to record more revenue from the telecoms company over the next few years through license fees, taxes and dividends. It will also mark a step forward by the Ethiopian government in its economic reform plan launched in December 2019, which provides for the opening of the capital of several other public enterprises.

Source: Agence Ecofin

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