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Reports suggest that both companies are exploring bids for a 45% stake in the state-run telco, hoping to capitalise on of Africa’s most rapidly growing markets
Anonymous sources speaking to Bloomberg suggest that both Orange and e& have been separately consulting with advisors to consider taking a stake in Ethiopia’s incumbent operator, Ethio Telecom.
According to the sources, discussions are at an early stage and no decisions have yet been made.
“We are looking closely at Ethio Telecom in particular to see under what conditions the Ethiopian authorities might allow a partner to take a stake in the operator,” explained a spokesperson for Orange.
e& could not be reached for comment.
The Ethiopian government has been in the process of liberalising its telecoms sector for a number of years now, but progress has been sluggish. The first of two new telecoms licences made available by the regulator was granted to what is now known as Safaricom Ethiopia back in May 2021, but the second licence proved harder to sell, with a bid from MTN being deemed too low for consideration.
Since then, the Ethiopian government has been struggling to restart the liberalisation process effectively, delaying the relaunch of the tender for the second telco licence as well as a plan to sell 45% stake in Ethio Telecom, largely due to unrest in the country’s Tigray region. However, after a peace treaty was signed late last year, these processes have gradually begun to restart.
Nonetheless, as of today there is still no fixed timeline for either sale.
Orange and e& have both demonstrated interest in the Ethiopian market for some time. With the second largest population in Africa and, until recently, one of the last remaining telecoms monopolies in the world, Ethiopia is viewed as something of an untapped goldmine for telcos, with huge potential for growth.
For Orange, which already has a major African footprint in 18 African countries, securing a significant interest in Ethiopia would further solidify their position on the continent, a key part of the company’s strategic plan for 2030.
e&, similarly, currently operates in 13 African markets, largely under the Moov brand and has been eyeing up international expansions in recent months. Earlier this year, the operator group increased its stake in Vodafone to 14.6% as a way to expand its international portfolio. More recently, the company has notably entered discussions with PPF Group over a potential strategic partnership.
PPF Group owns and operates five telecoms companies in Central Europe.
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