The Ghana government and mobile giants, Vodafone Thursday announced a deal under which the UK-based company will buy 70 per cent of its shares in state-owned Ghana Telecom (GT).
An official statement signed by Mr. Stephen Asamoah-Boateng, the Minister of Information, said an understanding had also been reached with Vodafone to float GT shares on the Ghana Stock market as soon as possible.
The transaction is, however, subject to approval by the Ghana Parliament.
“In consideration of this agreement, Ghana Telecom’s enterprise value is approximately US$ 1.3 billion plus a cash injection of US$ 500 million, totalling US$1.8 billion,” the statement said.
Ghana’s opposition National Democratic Congress (NDC) had raised the red flag over the privatisation of GT, saying the process lacked openness and transparency.
The party queried why government was exclusively negotiating with Vodafone Plc UK “without consideration for other bidders who are likely to offer higher bids than Vodafone and address the socio-economic needs of the country”.
Haruna Iddrisu, the party’s spokesman for communication, said the Ghanaian Constitution and Public Procurement Act demanded that such deals needed parliamentary approval.
He said what was happening was “clearly against and in breach of” established norms and standards for the privatisation of a telecom entity as required by the International Telecommunications Union (ITU).
But the official statement Thursday said many benefits would accrue to Ghanaians, including delivery of a superior product and services in every corner of the country, raising GT’s mobile market share to provide competitive per minute call charges, efficient service to ensure uninterrupted service to the consumer and injection of substantial investment into the economy.
The statement said Vodafone would leverage its experience in over 25 countries and partner networks in an additional 42 countries with over 260 million customers worldwide to provide the best service in telecommunication to Ghanaians.
“Vodafone’s brand and successful customer propositions such as ultra-low cost handsets will accelerate Ghana Telecom’s growth,” the statement added.
Upwardly mobile market
Commenting on the transaction, the statement quoted Mr. Arum Sarin, the Chief Executive Officer of Vodafone, as saying that “Ghana is one of the most attractive markets in Africa with mobile subscribers growing at more than 55 per cent per annum and mobile penetration around 35 per cent.
“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.”