Business

Airtel Africa finds relief in Qatar Investment Authority’s latest influx of money

Finance written on paper

Africa, the continent as a whole is a gold mine right now for businesses. Not in the actual sense but it is full of business opportunities as the countries in Africa are looking for development all around. The countries in Africa are what India was 30 years ago. It is been looked at for far too long and now the companies are slowly getting into Africa. Not all the countries in Africa need super development but there are countries like South Africa, Egypt and also Nigeria which have a lot of technically advanced things.

That said, many companies have turned their attention to the countries that really need infrastructure in Africa. Some Indian companies also have a presence in Africa, one of the most influential Indian companies in Africa is Airtel. Airtel Africa Ltd is present on the continent for almost 9 years now. It acquired Zain’s mobile operations after two failed attempts at buying MTN group. Zain was present in 15 countries then and now Airtel is present in the same number of countries in Africa.

Airtel Africa offers 4G services in ten of those 15 countries in Africa. Nigeria is one of the most profitable nations amongst those 15 as they have a lot of cheaper plans in Nigeria. The next country is Ghana where Airtel Africa experiences a lot of success. The company has around 78 million subscribers in Africa. Airtel is also the third largest operator in Nigeria after Globacom and MTN.

That said, the company is in debt in Africa. It had around $5 billion debt on its shoulders to pay. However, it has reduced it now to $3.5 billion. This is down to the pre-IPO funds which were about $1.25 billion, raised from many investors with huge funding. Apart from this, Qatar Investment Authority, the wealth fund of the state Qatar has also invested a huge sum of money.

Qatar Investment Authority has literally given Airtel Africa $200 million. They haven’t bought any kind of share or nothing has been given to them from the existing shareholders. This comes as a huge relief for the Indian company in Africa. The loan that remains now is only $3.5 billion.

Airtel now plans to spend $700-$800 million over a year and the next two to three years. This will be in order to expand its 4G in the countries which it does not offer the same yet. Apart from this, it will also increase the services in many other regions in the existing countries.

In the September quarter, Airtel Africa experienced a surge in its revenue by 11 percent. It grew from $723 million to $824 million.

-Unmesh Phule

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