Celtel to Acquire Majority Stake in Westel in Ghana

22 October 2007
Content from a Premium Partner
Celtel (Amsterdam)
press release

Zain's worldwide footprint now stands at 22 countries

Celtel International, a subsidiary of Zain (formerly named the MTC Group) announced today it has signed an agreement to acquire 75% of Western Telesystems Ltd (Westel) from the Government of Ghana for USD 120 million. The Government of Ghana remains a shareholder in Westel with a 25% holding through the Ghana National Petroleum Corporation. The transaction is subject to standard approvals and authorizations and is expected to conclude quickly.

Westel is the second national operator in Ghana and is licensed to provide fixed and mobile (GSM) telecommunications services The Zain Group, the leading mobile telecommunications network in the Middle East and Africa, aims to launch enhanced telecom services nationwide in the first half of 2008.

Dr. Saad Al Barrak, Zain's CEO, commented: "We are very excited to enter Ghana, one of the most important markets in Africa. We look forward to offering Ghanaians the quality telecommunications services which we provide in all the countries in which we operate. Based on our pan-African experience we are confident that the increased competition in telecommunications will benefit the people of Ghana and support the already robust national economy of the country."

The Honourable Minister of Communications of Ghana, Dr. Benjamin Aggrey Ntim said: "The Government of Ghana is delighted to welcome a world class telecommunications operator such as Celtel to Ghana, and we look forward to working together as partners. We are also very pleased to announce that the parties have agreed to list a portion of the company's shares in the future on Ghana's public stock exchange for the benefit of Ghanaians."

Celtel will be investing millions of dollars in a state-of-the art telecommunications network and associated services to offer its unparalleled experience as a pan-African operator, bringing telecommunications services to more than 24 million customers in 14 countries across the continent (15 with the addition of Ghana). Celtel prides itself on offering attractive career opportunities in its countries of operation, not only with the company directly, but also via its network of distributors, suppliers and advisors. Westel's current management and staff, who have worked under challenging circumstances to date, will play an important role in taking the company forward.

The company also looks forward to promoting Ghana as a gateway to West Africa through its One Network, the world's first borderless network. This offers Celtel's customers the opportunity to move freely across geographical borders using the same services they would access in their home country, and to make calls without roaming surcharges and without having to pay to receive incoming calls and messages. The service also permits customers to buy and top up with local airtime when they visit other countries in which One Network is operational. Celtel's One Network service is currently operational for 160 million people across six nations in East and Central Africa.

Key investment highlights

  • Ghana is a key sub Saharan market and a gateway to West Africa
  • Ghana is the 5th largest economy (purchasing power parity GDP) in sub Saharan Africa, and has experienced steady growth of approximately 6% in recent years.
  • With ~22 million people, Ghana is the 9th largest country of the 47 sub-Saharan nations, giving Zain's subsidiary Celtel a presence in 7 of the 9 largest sub-Saharan African countries by population.
  • The acquisition of Westel solidifies Zain's leading position in Africa under the Celtel brand, where its current footprint covers 14 countries with over 24 million customers.
  • With the addition of Ghana, Celtel's presence in Africa will expand to 15 countries, making the Zain Group's total footprint 22 countries
  • Ghana has a fast growing and attractive telecom market
  • Rapid growth in mobile subscribers in the last twelve months of approximately 56%
  • Low mobile penetration of approximately 28% offers significant growth prospects
  • Synergies across Celtel Pan African footprint
  • Celtel's unparalleled pan-African footprint includes neighbouring ECOWAS countries such as Burkina Faso, Niger, Sierra Leone and Nigeria, Africa's largest telecom market.
  • Westel will benefit from both Group synergies in branding, human resources, and best practices, and from becoming a part of Celtel's innovative "One Network".
  • Lehman Brothers acted as sole financial adviser to Zain's subsidiary Celtel.

Enquiries:

Mr Antoine Aboukhalil

Media and External Relations Manager

Zain Group Email: info@zain.com

Tel: +961 3 733 880 or +965 900 6974

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