Essar exits telecom business after monetising $6 bn

Essar Global Fund Limited (EGFL) Thursday said it has completely exited from telecom business globally after selling all existing stakes in its telecom businesses worldwide for $6 billion.

"Essar Global Fund Limited, a global investment fund controlling a number of world-class assets, today (Thurssday) said that it has completely exited the telecom business with successful closure of the transaction in Kenya. With this EGFL has completed monestising its telecom business for an aggregate value of over $6 billion," the company said in a statement.

Essar Telecom Kenya Limited (ETKL), which operates the popular yuMobile telecom service in Kenya has sold its network, IT, and office infrastructure to Safaricom, while Airtel has taken over the 2.55 million subscriber base. The total deal value of the transactions is approximately $120 million.

As a part of the transaction, close to 90 percent of the yuMobile's employees have been absorbed by Safaricom and Airtel.

"We are delighted to have completed this complex transaction and we are thankful to the Kenyan government, and the various regulators for their support in facilitating the transaction. We would like to thank our employees for their hard work and wish them every success in the future," said yuMobile CEO Madhur Taneja.

Airtel in a statement said it has successfully integrated yuMobile customers into its network.

"The process which started in August 2014 has seen the 2.55 million yuMobile customers successfully integrated into the Airtel network. Airtel now consolidates its position as the second largest mobile operator in Kenya with a combined customer base of over 8 million and a 26.6 percent customer market share," it said.

In 2010, Essar sold its telecom tower business to ATC for $425 million, in 2011, sold its entire stake (33 percent) in Vodafone Essar for $5.2 billion and in July 2014, the US-based outsourcing company, Aegis US, was sold to Teleperformance for $610 million.