Bharti Airtel has entered into exclusive talks with Orange to sell its businesses in four African countries: Burkina Faso, Chad, Congo Brazzaville and Sierra Leone.
In February, Bloomberg had reported that Orange was looking to buy some of Airtel’s businesses in Africa. A day later, an Economic Times story quoted an unnamed Bharti Airtel spokesperson as saying that “We strongly deny these rumours, which are completely baseless.” A lot can change in five months.
Some things to note:
– There is some history between the two companies: In March, Airtel and Orange struck a deal in Africa to allow Orange customers in Côte d’Ivoire to send money to customers of Airtel Money in Burkina Faso, and vice versa, owing to the interconnection between the two operators’ mobile money platforms. Airtel has a similar deal with MTN between the same two countries.
– Orange is a French telecom operator, and French is the official language of three of the four countries being discussed: Burkina Faso, Chad and Congo Brazzaville. The official language of Sierra Leone is English.
– Orange has 13.3 mobile money customers 13 countries in Africa and the Middle East, out a total of 101 million mobile customers in the region. It reported revenues of €1.124 billion (around $1.22 billion) for A&ME in the quarter ended 30th June 2015. Airtel’s Mobile Money base in Africa, as of 31st March 2015, was 6.2 million, out of a total of 76 million customers. Airtel reported revenues of $1 billion in Africa, for the quarter ended 31st March 2015. Airtel operates in 17 countries in Africa.
– In its last quarterly report, Airtel mentioned an interesting regulatory situation in Burkina Faso, saying that the Regulator is considering imposition of fixed line obligations on operators, and that “Efforts to persuade the Regulator to accept wireless fixed services instead of wireline fixed services are being made, in view of the huge financial outlay that will be required for cabling and wiring.”
– The B2B arms of Orange and Airtel India have a deal to allow customers of one b2b service to video conference with customers of the others B2B service.
– Fun fact: Airtel is present in 17 countries in Africa, and Orange in 13. If this deal goes through then Orange will be in 17 countries, and Airtel in 13.
Update: an earlier version of this story attributed the Feb 2015 report on Orange and Airtel being in talks to Mint instead of Bloomberg. Mint republished the story reported by Bloomberg.