Safaricom reaches agreement with Ethio Telecom to share towers and other telecom assets in Ethiopia

Safaricom reaches agreement with Ethio Telecom to share towers and other telecom assets in Ethiopia

Business Insider Africa understands that the deal is yet to be finalised.

No mention was made about the financial consideration for the deal.

Safaricom is expected to launch its Ethiopian operation any moment from now.

Safaricom Ethiopia, the recently-incorporated subsidiary of Kenyan telecom giant Safaricom Plc, said it has reached an agreement in principle with Ethio Telecom to share cell sites, interconnection and tower assets in Ethiopia.

Local media reported that Safaricom Ethiopia’s Public Relations Manager, Tewedaj Eshetu, disclosed this earlier this week. He also noted that deal has not been finalised, "as we are yet to sign a final agreement”.

Meanwhile, Safaricom’s Group Chairman, Michael Joseph, told Business Daily that “the deal is very important and critical for our commercial viability and launch. Hopefully (we will launch) soon but we don’t have a date yet”.

On his part, the Director General of the Ethiopian Communication Authority, Balcha Reba, also acknowledged that the deal is critical towards ensuring Safaricom’s success in the Horn of Africa country.

“Safaricom can launch the telecom service as of now, using its infrastructure it already developed in major cities. However, the call works only in-between Safaricom customers. To interconnect with Ethio-telecom customers, the infrastructure sharing agreement is key,” he said.

It should be noted that the financial considerations of the deal are yet to be made public.

Bear in mind that Safaricom’s latest infrastructure share deal in Ethiopia is coming barely a month after the company signed a 5-year infrastructure lease agreement with Ethiopian Electric Power.

Earlier in February, Safaricom unveiled its first data centre in Addis Ababa ahead of its anticipated launch. Business Insider Africa reported that the data centre cost the company $100 million and was constructed by in China by Huawei and Nokia. The company said plans are underway to construct two more data centres in the next five years.Upon launch, Safaricom Ethiopia will become the first privately-owned telecom firm in Ethiopia, following a recent privatisation exercise by the government.

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