French telecommunications giant Orange is reportedly exploring the sale of its 40% stake in Mauritius Telecom. Citing sources familiar with the matter, Bloomberg reports that Orange no longer considers the stake as a core asset and has initiated discussions with advisors regarding a potential exit strategy.
While Orange has not officially engaged in buyback talks with Mauritius Telecom’s board, a decision on the matter is expected to be reached by November 2024. However, deliberations are still in the early stages, and Orange could ultimately decide to retain its shares.
Orange’s influence within Mauritius Telecom has diminished over time as the stake’s strategic importance has dwindled. This decline in significance followed the expiration of a ten-year agreement allowing Mauritius Telecom to use the Orange brand name. Consequently, in 2017, Mauritius Telecom rebranded as MyT, further solidifying its independent identity.
Orange’s involvement in Mauritius Telecom dates back to 2000 when its predecessor, France Telecom, acquired the 40% stake through Rimcom Ltd. for approximately $261 million. Despite the potential divestment, Orange maintains a significant presence in Africa and the Middle East, with Mauritius serving as a key service center for multinational customers.
The company’s potential divestment from Mauritius Telecom comes amidst other strategic moves in the region. Orange is actively participating in discussions regarding a new subsea cable, T4, which would connect Africa, the Indian Ocean islands, and Asia, replacing the aging South Africa Far East (SAFE) cable. Additionally, a consortium led by Thales, a French IT company, has secured a deal to upgrade Mauritius’ national ID system with digital identity technology, further highlighting the country’s digital transformation efforts.
While the exact reasons behind Orange’s consideration of selling its Mauritius Telecom stake remain undisclosed, the move likely reflects a broader strategic shift towards prioritizing core assets and divesting from holdings that no longer align with its long-term goals.
The potential sale of Orange’s stake in Mauritius Telecom marks a significant development in the African telecommunications landscape. As the region continues to experience rapid technological advancements and increased competition, companies like Orange are constantly evaluating their portfolios to ensure optimal positioning for future growth and success.
