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Manoj Kohli To Return To India After Difficult Airtel Africa Tenure; New Airtel Africa CEO

Manoj Kohli, MD & CEO (International), in-charge of Airtel’s operations in Africa, Bangladesh and Sri Lanka, will relocate to India effective Jan 1, 2014, after a difficult time in Africa, where the company did not meet the ambitious goals that Kohli had set for the end of FY13, because he had underestimated the complexity of operating in Africa, and the state of Zain’s network and processes in the continent.

Taking over AFrica responsibility as CEO will be Christian de Faria, will join Airtel Africa starting September 16, 2013, operating out of Airtel’s Africa headquarters in Nairobi. de Faria joins from MTN, where he was Group Commercial Officer till January 2013, prior to which he was Executive Vice Presdent, responsible for operations for West and Central Africa region. He was with MTN for seven years. de Faria will join the Board of Bharti Airtel International Netherlands B.V. and the Boards of major Airtel operational companies in Africa. Kohli will continue on the boards of Bharti Airtel International Netherlands B.V. and Airtel Networks Ltd, Nigeria.

De Faria will report to Kohli, who will continue to lead Airtel’s international operations and provide governance oversight to Airtel Africa, Airtel Bangladesh and Airtel Sri Lanka. He will also lead strategic issues such as in-market consolidation via M&A, key matters relating to Towerco, global partnerships, global sourcing from key Partners and strategic Regulatory aspects, apart from being responsible for Business Development / M&A function for the telecom business and be involved with the group strategic matters, according to Airtel.

So how was Kohli’s African Safari? When he relocated to Africa, after Airtel acquired Zain, Kohli had set the following targets for Airtel in that continent:
– 100 million customers (Zain Africa had 42 million)
– $5 Billion in revenue (Zain Africa did around $3.6 Bn)
– $ 2 Billion EBITDA (Zain Africa did $1.2 Billion EBITDA)

For more on our Airtel-Zain coverage from 2010, read: Airtel In Africa: Investment Targets; Tanzania Problem; Wants Infra Sharing, MNP

Airtel hasn’t found Africa easy-going by any stretch of the imagination. At the end of Q3 last year, he had this to say on Africa, and about not meeting these targets that he had said:

“We had aspirations of $5Bn and $2Bn (Topline and EBITDA), but we could not achieve it. There were two gaps of judgement. At that time, the Africa market growth was 15%, and we thought we could grow 20%, but that didn’t happen because the market growth came down to 8%, and in some markets, to 6%. The infrastructure of network, IT, Brand, organization design, processes was weaker than we expected. I thought we could restructure that is 12 months, but despite the speed of Bharti, it took us two years. That extended the turnaround period. We did not continue Zain to be a voice company. We’re turning it into a portfolio of services. Revenue looks within reach, but not margins. A majority of our markets are challenger markets, where we have 15% marketshare, versus gorillas with 50-60% marketshare. Thus investments in market, network are essential. The focus on margins will be higher, now that we have proven that we can improve revenue marketshare.

On roadmap to profitability on Africa: Two goals for the coming year. The first is to get the cash right. Our goal is to cover cash cost of even acquisition interest, apart from all investment. That way it is not putting any pressure on the group. The other plan is to grow the topline faster. There are countries where we are earning profits, but there are others where we are not. Each country has an improvement guide path. Each market should be PAT positive. I can’t give a precise guidance.”

More in our concall report here.

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