UK-based Vodafone Group Plc says it has almost concluded the acquisition of 70 percent shares in Ghana Telecom, the national telecoms operator, under its wholly-owned Vodafone International Holdings B.V, with the Government of Ghana maintaining 30 percent interest.

Vodafone is among the world's leading mobile telecommunications companies, with a significant presence in Europe, the Middle East, Africa, Asia Pacific and the United States.

Per a news release issued by the company, it announced an agreement to acquire the 70% stake in GT for a total consideration of US$900 million on a debt-free, cash-free basis.

Vodafone Chief Executive, Arun Sarin, in a comment on the acquisition is quoted as saying “Ghana is one of the most attractive markets in Africa with mobile subscribers growing at more than 55% p.a. and mobile penetration around 35%. Our extensive operating experience together with our portfolio of products and services position us well to deliver a superior mobile experience to Ghanaian customers and significantly improve financial performance. I expect that our investment will generate substantial benefits for Vodafone and for the Ghanaian economy and we are delighted that we will be working in partnership with the Government of Ghana.”

The company projects strong, strategic rationale and turnaround opportunity for the acquisition, and lists among others, exposure to the attractive and growing Ghanaian telecommunications market, total population of 24 million with more than 50% under the age of 25, real GDP growth of 6.3% in 2007, contained inflation and a stable political background, low mobile penetration and significant additional growth prospects from recent oil field discoveries as expected principal benefits.

As part of the transaction price, it has been agreed that the Government of Ghana’s fibre network assets will be transferred to Ghana Telecom, however the transaction remains subject to certain closing conditions, including approval by the Parliament of Ghana.
The company said it expected the transaction to close in the third quarter of 2008.

Meanwhile the minority National Democratic Congress in Parliament have objected to the sale of GT to Vodafone already, claiming the company lacks the capacity and expertise to operate and manage the largely fixed-line telecoms company.

The NDC argues that the national asset is going for too little ($1.3 billion) and declared it would do all it could to torpedo the transaction. At a press conference to voice out its opposition, the NDC also accused the government of lack of transparency in the entire process.

“The current situation is clearly against and in breach of established norms and standards for the privatization of a telecom entity as required by the International Telecommunications Union,” said Haruna Iddrisu, the Member of Parliament for Tamale South and the ranking member on communications.


Author: Isaac Yeboah