Kenya Telkom was one of the first institutions to be felled by incompetence and corruption. Why is it disposing of its assets, and at the same time promising expansion? Take loans, Invest so much then hand it over of a penny, sick stuff. This one is going to turnout like Kenya Power and electicity trauma.
“On April 3, 2018, the company, (American Tower Corp) through its recently formed Kenyan subsidiary, (AT Kenya C.V) entered into a definitive agreement with Telkom Kenya Limited to acquire up to 723 communications sites,” said the firm in regulatory filings.
Telkom Kenya said earlier that its five-year strategy is to invest Sh15.2 billion ($150 million) in its 3G and 4G networks as well as mobile financial services and customer experience.
Telkom Kenya is also set to receive a Sh4.1 billion ($40 million) loan from the European Investment Bank to boost infrastructure and mobile money network.
Because its costly to manage them and outsourcing is cheaper. Airtel sold all their sites to a private company as well on a sale and lease back agreement. That same company leased it to Equitel for its operations.
Why? Because both companies were foolish enough to expand their network on loans without making sure they get enough increase of new subscribers to make the venture viable. Two once the numbers failed to materialize they started a price war thinking that’s the magic trick. It also failed spectacularly. Now the balance sheets is full of debt. France Telkom quit and ran selling Telkom shares to this new UK investment firm who now have to make tough choices. Airtel Kenya is on sale as well.
You don’t copy what a private company has done, when you property portfolio is so rich. Kenya Telkom failed because its directors obstructed expansion in the right direction to give mileage to Safaricom – the 5%.
It is not possible to succeed when you choose the wrong action - It has become a milking cow via debt. Telkom is viable, it needs to Partner with honest Partners - vision; look toward Countries like South Korea, Estonia or Singapore; Telkom would get a transformation and technological transfer of another level with a reach to the East African counties.
Telkom has more advantages than Safaricom, yet it is stuck competing for few customers, why.
Hakuna kitu unajua, KPTC property portfolio is held under Trust. Its not part of Telkom since it still remains public land that NLC should have a say on. That became clear when Telkom and Airtel were discussing a merger. Telkom has leases for the land but not ownership.
Safaricom was a department under KPTC, former president Moi privatised it to Vodafone. It was split from KPTC. Also split from KPTC was Telkom Kenya, CCK and Posta. Before 2008, Safaricom was 49% owned by GoK and 51% by Vodafone. Telkom Kenya sat on that board on behalf of GoK. Vodafone picked CEO and CFO, Telkom picked Chairman of the board. They shared sites. In 2008 former President Kibaki initiated Safaricom IPO where GoK would reduce its shareholding from 49% to 20%. Vodafone kept its full 51%. Vodafone had conditions in order to okay it since on contract they had first option to offer to buy the shares. They demanded Telkom to be removed as GoK rep on the board but Treasury to take that seat directly. They also wanted full separation of sites and shared facilities. Why? Telkom wasn’t paying its end of the shared costs. It was agreed. 2009 Gok sold 60% shares of Telkom to France Telkom aka Orange.
Welcome to Kenya. Where parastatals are plundered and later sold for a song to politicians and their briefcase companies. I wouldn’t be surprised if an Alfred Keter is the point man of these American buyers.
Aren’t they (telkom) the ones who own most communication Masts or are thy rented from Allan Dick company pale westy?
I tried getting a Mast or Space on one of those Masts nikapewa Quotation, karibu nikufe…I’d have left my great grandkids thrice down the line paying the loan!
So if Telkom owns most masts and other telcos are piggy backing on them, then these Drumpfs come and acquire them, they can adjust the prices up to make profits which will lead to ther telcos adjusting upwards, leading to us consumers paying the price…ama my reasoning is skewed?
Many staff left Telkom, went to work in the private tele companies, what kind of metamorphoses did they under-go to become competent yet were incompetent while at Telkom – they were able, obstruction by the corrupt senior’s Staff.
There were competent people in Telkom - in fact they made Safaricom what it is. But that just emphasizes the argument that if you moved the entity to private hands, it would do so much better. Telkom, or KPTC as it was then, was such a shambles. Move those people to a private sector entity like Safaricom and they perform wonders, because there is governance and business drive.
I am not saying Safaricom is wonderful in its own right relative to other private sector entities. There are certainly areas it could improve in. But I am saying that relative to KPTC, Safaricom is stupendous. Telkom could be too, if it were in private hands.
Bottom line: Government has no business being in business.
This deal surely cannot go through we’ll be directly allowing the NSA/CIA direct access to our communication grid so they can hack and listen in on government deals and etc.
Anyway 60% of Telkom Kenya is held by Nigerians so what does this mean about the governments share???
Finally Telkom Kenya has been plundered anyway and made irrelevant why are they still in 2018 providing dialup internet? The company should have deeply entered the broadband game and offer also fiber to home services. It should be the ones capable of providing free WiFi in government buildings and counties country wide.
Contrary to your assertions, Telkom is the company to watch in the coming years. Since Hellios came on board last year, they have rebranded the company, brought a new management team on board, and for the first quarter of 2018 they had the highest number of new subscribers. They have also launched attractive data plans and plans are underway to expand their 4 G services beyond Nairobi. If the trend continues, I believe an IPO would be in the offing.
Boss, this is not an acquisition. No one is selling Telkom and again the company has been under the control of private companies for more than 10 Years.