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(Ecofin Agency) – Companies wishing to operate in the Kenyan ICT sector are obliged to sell 30% of their capital to local investors. In the Kenyan telecoms market, Airtel is the only operator yet to comply with this rule.
Telecom group Airtel Africa is set to list its Kenyan subsidiary on the Nairobi Stock Exchange (NSE) to comply with current regulations. This was revealed by Segun Ogunsanya, Group CEO, during recent discussions with the regulator for Airtel Kenya’s 5G rollout and telecoms network expansion.
“As part of our licensing obligation, we must be listed on the Kenyan stock exchange. Over the past two months, there have been discussions about whether this condition would be changed or whether it would be maintained. We are still waiting for a clear indication from Kenya as to whether there is still a listing requirement,” said Ogunsanya.
The Kenyan government, through the Information and Communication Technology Sector Policy 2020, introduced a rule stipulating that only companies with at least 30% Kenyan capital would be allowed to provide ICT services in the country.
Airtel, which benefits from an indefinite waiver granted in 2013, will have to reach the local shareholding threshold within three years of the date of the notice (March 25, 2021). Last February, the company announced that it was in talks with the regulator to determine the best way forward to ensure local participation in the sector. It has a choice between an IPO and the direct sale of at least 30% of its capital to a Kenyan investor.
Last April, at a regional trade summit in Nairobi, President William Ruto announced his government’s plans to repeal the shareholding rule. While the initiative should facilitate foreign investment in Kenya’s ICT sector, no official decision has yet been taken.
“We are working on ways to comply with all the legal requirements of our license. So, if we have to go public, we will. But again, the Kenyan authorities have indicated that it may not be a requirement. But whatever the requirement, we’ll respect it,” added Mr Ogunsanya.
Isaac K. Kassouwi
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