Etisalat agrees to exit Zantel, with Millicom picking up the stake

Etisalat Group has announced the sale of its 85 per cent stake in Zanzibar Telecom Limited (Zantel) to Millicom. Under the terms of the agreement, Etisalat will receive cash consideration of US$1 and Millicom will assume total debt obligations of US$74 million. In addition, Zantel will have up to US$32 million in net current liabilities at closing.

The transaction remains subject to regulatory approval by the Tanzanian Communication Regulatory Authority and the Fair Competition Commission.

Last September it was reported that Etisalat was considering the sale of its operations in Tanzania, with sources at the time suggesting that it was exploring the sale of its stake with the help of Deutsche Bank.

Zantel is a relatively minor player in Tanzania, but Millicom, which owns Tigo Tanzania, could benefit from the acquisition.

The remaining 15 per cent stake in Zantel is owned by the government of Zanzibar.