The French-based telecom company, Orange, has expressed interest in purchasing some shares in Ethio-Telecom, Ethiopia’s state-owned telecommunications company. The Ethiopian mobile phone company is in the process of privatising its business and is looking for investors to buy a 40% stake in the company.
Ethiopia’s telecommunications sector is highly attractive to foreign investors due to the country’s huge population exceeding 100 million people, and the unexplored potential in the industry. In May, the country issued a telecommunications license to a consortium led by Safaricom, in a bid to open up the mobile industry and enhance the quality of telecommunication services in Ethiopia. The consortium intends to start operating in Ethiopia in 2022 by providing mobile phone and data services in the fastest growing economy in East Africa.
Ethio-telecom’s full-year revenue climbed by 18% to 56.5 billion birrs ($1.28 billion) on 30th June 2021, up from 47.7 billion birrs ($1.08 billion) in the same period last year. The company reported growth in revenue despite the security challenges in some parts of the country and the covid19 crisis. Ethio-telecom’s CEO, Firehiwot Tamiru, credited the good performance to improved customer service by optimizing the telecom’s network.
Orange plans to acquire the 40% stake being offered by the Ethiopian government at an undisclosed value. If the deal is successful, the French telecommunications company will support Ethio-telecom to grow its subscriber base which currently stands at nearly 53 million and expand the telecommunication network in a country with little 4G coverage.