Safaricom shortlisted for Ethiopia Telecom License Bid: Report

ADDIS ABABA – Safaricom said on Wednesday the telecom firm has made it to the shortlist of six firms that have been cleared to bid for one of two Ethiopian telecoms licenses scheduled to be offered this year.

Safaricom’s Chairman said the Ethiopian Communications Authority (ECA) has already whittled the list down from a consortia of 12 that had expressed interest in entering the country’s telecommunications market.

Safaricom’s claim came two weeks after regulator of the sector extended the biding period for new operating licenses by one month citing requests by interested companies. Competing firms are required to submit their technical and financial bids by April 5, compared with a previous deadline of March 5.

Safaricom has signed an agreement to borrow up to $500 million from America’s sovereign wealth fund US International Development Finance Corporation (DFC) to fund its expansion to Ethiopian market.

“There are about five to six consortia who are qualified to bid. Bids are due to be submitted in April,” said Michael Joseph, Safaricom chairman, in an interview with Business Daily.

“We are working towards the final submission around March/April,” he added.

Ethiopia’s telecoms industry is considered the big prize due to the huge size of the market, which serves more than 100 million people.

The government is auctioning two telecom licenses and the sale of a 45 percent stake in state monopoly Ethio Telecoms. The transactions are part of economic liberalization policies being implemented by Ethiopia.

The Safaricom consortium, if successful, will likely rely on funding from deep-pocketed foreign investors such as DFC given the size and international nature of the Ethiopia investment.

Last Year, ECA announced that it had received expressions of interest from scores of firms, including telecom and non-telecom operators by June 22.

Apart from Safaricom, the list of includes, Etisalat, Axian, MTN, Orange, Saudi Telecom Company, Telkom SA, Liquid Telecom, Snail Mobile, Kandu Global Communications and Electromecha International Projects.

Ethiopian Communications Authority (ECA) is yet to disclose which of these firms have been dropped from bidding.