Vodafone forced to reduce Ghana Telecom stakeholding

Ghana’s government announced that 20 per cent of Ghana Telecom’s (GT) shares, originally sold to Vodafone as part of a US$900 million deal, will now be listed on the Ghana Stock Exchange instead, a Ghanaian newspaper reported.

Ghana Telecom is the incumbent operator providing fixed-line, mobile and Internet services. 

The government and Vodafone had reached an agreement last week for the sale of 70 per cent of GT to the UK cellco, with the government retaining a 30 per cent stake, but the contract faced opposition from minority parties over the exclusion of outside bidders.

Minister of information and national orientation, Stephen Asamoah-Boateng, stated that Vodafone had agreed to float the remaining 20 per cent of the shares on the Ghana stock market as soon as possible, and stressed that Vodafone’s brand and customer propositions would accelerate GT’s growth through a substantial investment in the company.

The move follows opposition from parliamentary parties that argued that the original deal valued GT at US$1.3 billion, though its true value was closer to US$1.5 billion.

Haruna Iddrisu, the minority ranking member of communications said he wanted to know why the government went into exclusive negotiations with Vodafone without considerations of other bidders “who were likely to offer higher bids”.

Iddrisu also demanded answers on why the government upped the 66.7 per cent stake it had initially planned to divest, to the then agreed 70 per cent.

The contention over the sale of GT comes close on the tail of a dispute by UAE-backed Warid Telecom over the award of Ghana’s sixth mobile licence to Nigeria’s Globacom last month.

Warid was also shortlisted for the licence along with Globacom and was equally qualified to pay the minimum reserve price of US$50 million, but claims the opportunity was never offered.