More Africa NewsTanzania: Al Nahla Group to invest USD 120 million in Smile Communications Tanzania

June 14, 2022by myles0

The pan-African group Smile Telecoms was under the threat of liquidation in March 2021, when it was crumbling under debt. The company finally found common ground with its creditors, who granted it a 12-month reprieve.

The pan-African telecom group Smile Telecoms Holdings, present in Nigeria, Uganda, Tanzania and the Democratic Republic of Congo, will benefit from financing of 120 million USD from its majority shareholder Al Nahla Group. This new injection of capital will notably enable the company to extend the footprint of its network in Tanzania.

According to Zuweina Farah, Country Manager of Smile Tanzania, the new investment will allow the mobile operator to continue offering the best 4G LTE broadband internet services in Tanzania. Using the latest technology, the company plans to provide its subscribers with “  speeds of up to 50 Mb/s  ”.

This investment promise follows the restructuring plan of Smile Telecoms announced at the beginning of February, which notably provided for “  the takeover of the company by the super senior lender and new additional financing from the super senior lender  ”.

In March 2021, Smile Telecoms was threatened with liquidation, in particular because of a debt of 365 million USD raised five years earlier to finance its growth ambitions. However, the company was able to count on the rescue in extremis of the Nahla Group, which invested 51 million USD after the operator’s debt restructuring plan was approved by its creditors. Public Investment Corporation (PIC), the pension fund for South African civil servants, which had loaned 50 million USD to Smile Telecoms against 7.69% of shares, exercised its put option on its shares whose expiry date expired on March 31, 2021.

According to Smile Group, the new funds implemented through the restructuring plan will strengthen and enable the company to “  safeguard its operations and achieve its business objectives  ”. Concretely, the group will further strengthen its position in its various markets, boost its operations and improve its efforts to obtain better telecom performance for consumers. 

Source: Agence Ecofin

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