Millicom’s Strategic Shift in Africa
In a noteworthy recent development, Millicom, a telecommunications company with a focus on emerging markets, has formally wrapped up its divestiture program in Africa.
Details of the Divestiture
The company is set to sell its operations in Tanzania and part ways with its stake in the AirtelTigo joint venture in Ghana, which it operates alongside Bharti Airtel from India. Millicom expects to receive $25 million for its Ghanaian operations, although additional financial details remain undisclosed.
New Ownership and Future Prospects
The Ghanaian government will take over the AirtelTigo operations, marking a significant shift in ownership. Axian Group, based in Madagascar, will be acquiring Tigo Tanzania, expanding its presence in several African markets, including Senegal, where it was previously part of a consortium with Millicom in 2018.
Millicom’s Changing Landscape
Millicom’s Tigo brand currently boasts over 52 million mobile subscribers spanning 11 countries in both Latin America and Africa. However, with these recent changes, the company’s subscriber base will experience a shift. The company has also exited markets like Chad, the Democratic Republic of Congo, Rwanda, and Senegal in recent years.
Historical Context
Millicom’s investment journey began in 2000 across Asia, Africa, and Latin America, with the launch of the Tigo brand occurring in 2004. The company has determined that its returns from the African market haven’t matched those from Latin America. Nonetheless, Axian is optimistic about the potential of the Tanzanian telecommunications landscape, viewing it as a promising opportunity.
Axian’s Growing Influence
According to the Financial Times, Axian operates Telma in Madagascar and has established its footprint in Senegal through Free Senegal, previously under the Tigo brand. The company also operates in Togo through Togocom and is a significant investor in the EASSy cable system, a critical 10,000 km underwater network along Africa’s east and south coastal regions.
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As Millicom’s strategy in Africa evolves, what implications do you think these changes will have on the telecommunications landscape in the region?