The Ghanaian government has acquired a 100% shares of the Telecommunications Company, AirtelTigo, for US$1
The Minister of Communication and Digitalisation, Ursula Owusu-Ekuful, revealed this in a news report by CNBC Africa on Wednesday, April 22nd 2021.
Minister Ursula explained that the current state of AirtelTigo and the circumstances under which its shareholders decided to leave the market was what led to the acquisition of the company at $1.
According to her, this would offer the Ghanaian government financial liberty to reinvest into the company and bring it out of the challenges the Telecoms industry is facing.
She added that the government had renegotiated many of the loan facilities AirtelTigo had acquired and reached a high level of debt forgiveness.
As a means of salvaging this situation, the Ghanaian government and the company’s initial shareholders have agreed to equally share a US$100 million facility acquired from Standard Bank. This loan facility is one of the most significant debts on the company’s books.
The Minister shared that the government worked closely with the Ministry of Finance in all the negotiations. She added that the shareholders of AirtelTigo are not transferring the shareholder credits which they’ve advanced to the company.
According to her, “That’s one of the main items hurting the balance sheet of the company, one hundred per cent of all the loans have been forgiven more or less. They are not seeking repayment of those loans.”
“There were also some commercial facilities that the company took, key among them is a $100 million facility from Standard Bank and with that also, AirtelTigo has taken 50 percent of that facility, so the company is now just saddled with 50 percent of that liability. These measures also helped free the company from the burden that it was under,” the Minister explained further.
She indicated that these kinds of developments are part of the dangers that a country is opened to with multinational establishments in critical sectors.
“Government isn’t going anywhere. That is the danger when you have multinationals, what impact the decisions they make may not be exactly the same as what your own national companies will take into consideration. For them, they have the option of leaving to go back to their home region, but we are not going anywhere, and so it is in our interest to also grow local entrepreneurs in the space and the government is committed to doing that, maybe this will provide us a vehicle to also do that even more.”
The Minister is optimistic that the negotiation will give the company a fresh start. She added that any interim management that would take over would have a good balance sheet that can attract investments to the company.
AirtelTigo is a dynamic and innovative brand providing a wide range of telecommunications services including mobile voice, data, mobile financial services and business connectivity solutions.