Airtel Kenya will pay Sh1.1 billion for a new 10-year year licence as part of the out-of-court settlement with the telecoms sector regulator.
This will be in addition to a Sh2.2 billion fee for the current licence it has been using since 2015, bringing the total payment to the Communications Authority of Kenya (CA) to Sh3.4 billion.
“This $30 million (Sh3.4 billion) investment reflects our continued confidence in the tremendous opportunity inherent in the Kenya market,” the telco’s parent firm Airtel Africa said in disclosures to the London Stock Exchange where it is listed.
The multinational said that in respect of settlements regarding 2015-2025 operating and spectrum licence, Airtel Kenya will pay a total of about $20 million (Sh2.2 billion) in four instalments over the next three years.
In respect of the 2×10 MHz licence, 2022-2032, Airtel Kenya has agreed to a 10-year licence for $10 million (Sh1.1 billion).
The agreements were inked on February 11, allowing the telco to start negotiations to exempt the firm from a rule that requires local shareholders to own at least a 30 percent stake in telecom companies by March 2024.
However, the government maintained that Airtel Kenya must first renew its licence before entering talks on the waiver of the local ownership rule, a stance that threatened to escalate the licencing row
Commenting on the matter communications Authority of Kenya Director General Ezra Chiloba said he was glad they were able to reach an agreement and taxpayers will receive about Ksh 2 billion over the next 24 months
“I am glad to report that we struck a deal, and this is a major achievement for us… Taxpayers are guaranteed to receive about Sh2 billion in the next two years. They came up with a payment plan, which we agreed on.” CA director-general Ezra Chiloba
Airtel Kenya has been operating on a licence acquired from Essar’s (yuMobile) when it bought out the rival firm in 2014.
The telco had argued that the CA had agreed to merge its operating licences with the ones it purchased from Yu Mobile in 2014 for the $6.976 million (Sh795 million) it paid to acquire the rival firm. The yuMobile licence is to expire on January 27, 2025.
The firm claims that upon its purchase of Yu Mobile spectrum and frequencies, the CA changed its earlier position and demanded an additional Sh2.15 billion as a condition for renewing its operating permits.
The telecom had earlier told the court that it would have abandoned the Yu Mobile deal had the regulator disclosed it would demand separate spectrum fees of Sh2.15 billion.
The regulator maintains that the yuMobile licence Airtel is currently operating under was not automatically transferable.
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