The Essar Group is returning the telecom service operations it acquired from Warid Telecom in Uganda and Congo and the group is looking for a buyer for its Kenya operations.
In March 2011, Essar agreed to sell its 33 per cent stake in Vodafone Essar to UK-based Vodafone. The group had struck a deal for a majority stake in Warid Telecom’s operations in Uganda and Congo in November 2009, with an enterprise value of $318 million.
In a statement, the Essar Group said, “It was mutually decided between the partners, Essar and the Warid Group, not to proceed with the deal closure as certain condition precedents pertaining to government clearance were not met.?
The assets are now being returned to Warid, which will have to repay Essar. Essar is also looking to sell its telecom operations in Kenya. The group had bought it for about $150 million and invested another $100 million in it. The company would be willing to sell it for about $300 million.
Essar operates telecom services in Africa under the Yu brand. In Kenya, the company is the third largest operator, competing with Safaricom, Orange of France Telecom and now Bharti Airtel.
