France Telecom (FT) Orange is in negotiations to acquire Congo China Telecom (CCT) for around €300 million. The French telco is already in exclusive negotiations with ZTE, which has a 51 per cent holding in CCT, and has registered its keen interest in bidding for the remaining 49 per cent held by the government of the Democratic Republic of Congo.
This move by FT Orange would follow the strategy recently outlined by CEO Stephane Richard to look for growth in Africa and the Middle East. The company already has subsidiaries in Cameroon, Ivory Coast, Kenya and Morocco.
The opportunity presented by entering the Democratic Republic of Congo via CCT is significant: a population of 65 million, a mobile phone penetration rate of 17 per cent and no dominant operator. But the per capita income is reported to be around $300, and the country is still recovering from more than 40 years of political turmoil and war.
However, Nick Brown, an analyst at London-based investment bank Espirito Santo, told Bloomberg: "Just by increasing the penetration rate, there's a pretty big opportunity there. It's much more appealing than going into a more mature market."
CCT was formed in 2000 by ZTE and the Congolese government; it now has around 100 employees and is the fourth largest operator.
For more:
- see this Bloomberg article
- see this Reuters article
Related Articles:
France Telecom plans heavy investments for future profit
France Telecom's Q1 profits dragged down by Europe, MEA seen as saviour
FT Orange exec: Stopping churn is now No. 1 priority
France Telecom seeks network sharing deals, mulls asset sales