The head of Telecel Group, an Africa-focused telecommunications company part-owned by French tycoon Hugues Mulliez, said the purchase of Vodafone Group Plc’s operations in Ghana is part of a plan to build up its business and go public within the next five years.
(Bloomberg) — The head of Telecel Group, an Africa-focused telecommunications company part-owned by French tycoon Hugues Mulliez, said the purchase of Vodafone Group Plc’s operations in Ghana is part of a plan to build up its business and go public within the next five years.
The all-cash deal was part of Telecel’s expansion strategy ahead of a possible initial public offering, Chief Executive Officer Moh Damush said in an interview.
“The Ghana deal is important because it’s shifting the group from one size to another,” Damush said in London this week. “The European and London stock exchanges are more familiar with African ecosystems, so that is more attractive for us at the moment.”
Telecel, one of the first telecom operators in Africa, was acquired by Damush, Mulliez and Nicolas Bourg in 2017. The firm operates in Central Africa Republic, Liberia and has a service provider and partner in Mali.
Africa is home to the youngest and fastest-growing population in the world, making it an attractive growth market for mobile companies like Telecel. However, operators face an array of regulatory and policy risks in many jurisdictions across the continent, while having to navigate poor markets that often lack adequate energy supplies.
In a recent example of the troubles such companies can face, the biggest operator in Ghana, MTN Group Ltd., said this week it is in talks with local authorities over a surprise back-tax bill of $773 million that it disputes.
Damush said Telecel plans to double the number of towers it operates in the next two years in a bid to compete with South African-based MTN. Vodafone’s network consists of about 2,000 towers, compared with MTN’s 5,000.
The group plans to provide rural areas with connectivity via satellites, according to Damush. New regulations in Ghana to foster competition in the market will also let Telecel offer roaming on the MTN network while its network expansion is being carried out, he said.
Telecel has been holding talks with potential investors as it plans to continue its acquisition drive focused mainly on West Africa, Damush said.
“We are looking for opportunities in that region, we have the management capacity to take on additional assets, and our financial capacity is growing,” he said.
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