Tigo Senegal reaches licence settlement with government

Millicom International Cellular says that it has settled its mobile licence dispute with the government of Senegal. This settlement is subject to the signing of final documentation between the mobile operator and the Senegalese government as well as the publication of an amended licence.

Under this agreement, the validity of Millicom’s Senegal subsidiary’s licence will be recognised by both parties.

In addition, Millicom will be granted a 3G licence, an alignment of its licence terms with those of the other operators (meaning that Millicom will receive licences to offer fixed line, WiMAX and cable TV services for instance), some additional spectrum and a 10-year extension of the term of its current licence until 2028.

Millicom has agreed to pay US$103 million for these additional licence rights and spectrum. The US$103 million will be paid in several instalments between closing of the agreement and December 2013.

In conjunction with the announcement, both parties are asking for a three-month suspension of the on-going arbitration proceedings, initiated in 2008 before the ICSID (International Centre for Settlement of Investment Disputes), in order to finalise the documentation needed for the transaction to close.