Chairman King

Vivendi Business News

French Firms at Heart of Race for African Mobile Telecommunications Markets

Jul 21

Posted by Staff Writer in News | Post Comment

Cell Phone UserThe scramble for mobile markets in Africa is well underway, and while early activity was driven by expansionist local operators like MTN, the European giants are now stepping up their game, with French players poised to shake up the picture significantly.

There are two key aspects to the multipronged attack by French players from Vivendi and Orange to new start-up Augere. One is acquisition of existing 2G and 3G players or licenses, the other is to establish footholds using new technologies, with WiMAX at the forefront.

France Telecom is using WiMAX in many sub-Saharan African territories to expand its Orange brand even before it can gain 3G licenses, and now new company Augere – founded by former Orange CEO Sanjiv Ahuja – is pursuing a similar strategy.

Augere, a London-based start-up, has raised EUR 88m (USD 125m) in an initial round of funding from France Telecom itself (which holds a 22% stake), plus US venture capitalists New Silk Route and Vedanta Capital. It plans to launch WiMAX networks in Rwanda and Uganda early next year, and then Nigeria. Read the rest of this entry »

Tags: , , , , , , , , , , , , , , , , , , , ,

Zain Rejects Vivendi’s Offer to Purchase Africa Assets

Jul 20

Posted by Staff Writer in News | Post Comment

ZainZain has reportedly rejected a bid from Vivendi to buy a 65% stake in Zain Africa for about $10.5 billion. The reason for the rejection is unclear but it is allegedly connected to the proposed method of payment.

Kuwaiti telecommunications group Zain, which is being advised by UBS, said several parties had expressed interest in Zain’s African operations, although any sale would not include Zain’s Moroccan and Sudanese units. Zain said on Monday it still hoped to sell its African unit. A number of companies other than French media and telecommunications giant Vivendi have already signed confidentiality agreements relating to Zain Africa, banking sources said.

“I can’t find a tactical reason for selling this operation at this time,” said Jithesh Gopi, Head of Research at Bahrain-based Sico Investments. “The African operations have affected their profits in the last couple of quarters, so this may be a factor.” “These are operations and investments that require time,” said Gopi. “This (Africa) is one of the only remaining growth markets in the world as far as mobile is concerned and so on … This is a very big operation so everyone will be cautious,” Gopi said, adding that only a handful of top telecommunications names would have the capacity or appetite to take on the venture. Read the rest of this entry »

Tags: , ,

Zain CEO Denies Rumors of Deal to Sell African Operations to Vivendi; Zain Shares Fall 9%

Jul 9

Posted by Staff Writer in News | Post Comment

ZainShares of Kuwait’s biggest telecoms firm, Zain, fell almost 9% on Thursday after the company’s CEO, Saad al-Barrak, said there was no deal yet to sell Zain’s African operations to Vivendi. It had earlier been reported on this site that Vivendi had made an offer for Zain’s African operations.

Zain stock, the most heavily traded on Kuwait’s main index, fell 8.9%, its largest one-day loss since March 31, to close at 1.02 dinars, bringing its losses for the week to around 18%. The Kuwait index closed down 1.6%.

Zain’s CEO told Reuters on Wednesday that the company, the Gulf Arab region’s third-largest telecom firm by market value, was in early talks over a stake sale in its African operations but there was nothing definite yet. He also denied a newspaper report that the company had reached a deal to sell the unit to French entertainment group Vivendi for $12 billion.

“After the statement made yesterday by Saad al-Barrak of Zain the stock witnessed heavy selling,” said Fadi al-Zaghri, a broker at NBK Capital. “The stock has been rallying for the past month based on rumors that Zain is interested to sell its African operations to Vivendi.” The stock fell this week after France Telecom said it was not considering, for now, a bid for Zain’s assets. Vivendi today confirmed that it is indeed in talks with Zain to acquire a majority stake in Zain’s telecommunications activities in Africa. “However at this stage there is no certainty that the discussions currently in progress will lead to a successful outcome,” Vivendi said in a statement. Read the rest of this entry »

Tags: , , ,

Vivendi Makes an Offer to Buy Zain’s African Division

Jun 30

Posted by Staff Writer in News | Post Comment

VivendiAccording to sources, France’s Vivendi SA has made an offer to purchase Zain’s African division. In addition to Vivendi’s offer, Zain has also received offers from other major telecommunications firms.

Zain has asked UBS AG to consider a possible sale of its African division, which it values at about $10 billion, three people familiar with the plans said. UBS will oversee a review that may lead to a sale of all or part of the unit, said the people, who declined to be identified because the talks are private. Zain is yet to decide on a sale, which would exclude its Sudanese operations, the people said.

Based on Zain’s original investment of $3.4 billion, in 2005, Zain stands to make an investment return of close to 200% (an average annual return of about 50%), if Zain was to sell its African division for $10 billion. Read the rest of this entry »

Tags: , ,