Vodafone, Safaricom beat MTN to Ethiopia licence

Ethiopia awarded a consortium including Vodafone Group, Vodacom and Safaricom a licence to become the country’s first private mobile operator, though a bid led by MTN Group to become a second new entrant was rejected.

In a statement concluding the lengthy process of opening up the country’s telecoms market, the Ethiopian Communications Authority (ECA) and The Ministry of Finance confirmed Global Partnership for Ethiopia consortium had been successful in its bid.

Mobileworldlive reported that Global Partnership for Ethiopia comprises Vodafone and its affiliates alongside finance partners CDC Group, Sumitomo Corporation and the US Development Finance Corporation.

As part of its bid the consortium pledged to spend $8 billion on the operation over the next 10 years. ECA director general Balcha Reba said the winning bidder had “committed to create new jobs, support the economy through introduction of new and efficient services”.

The new entrant was one of two bids submitted at the final stage of the sales process last month after an initial 12 expressions of interest were made.

Although Ethiopia had planned to make two licences available to new entrants, a bid by MTN and finance partner Silk Road Fund was rejected.

In the statement, the authorities noted the award to one winner brought the process to a close, however Financial Times reported the second licence would be re-tendered.

Although not formally disclosed by authorities in their statement, FT reported the winning bid came in at $850 million with MTN’s failed offer of $600 million considered too low.