Kenyan leader will end France Telecom dispute this week
Kenya’s prime minister will be grilled about alleged asset stripping at Telkom Kenya during a meeting with French government ministers this week, as the row over the sale of the Kenyan carrier escalates.
Senior France Telecom staff will attend the meeting with Raila Odinga and French government officials to argue the case for a $325 million (€263 million) refund on the $390 million it paid for a controlling stake in Telkom Kenya in 2007, after claiming key assets were missing when the deal was completed.
The French government’s involvement signals an escalation of the dispute, which so far has involved only France Telecom, the Kenyan government, and a host of investment bankers and lawyers, The East African reports.
France Telecom claims the value of Telkom Kenya’s infrastructure was overestimated, and that numerous fixed assets disappeared by the time its takeover was completed.
The telco has also complained that it didn’t have the chance to conduct a full inspection of the Kenyan network, and was kept in the dark about a government commitment to produce low-cost CDMA handsets, the newspaper states.
Odinga has pledged to discover the truth about the deal during the meetings, and to work out a solution this week, Reuters reports.
France Telecom last week racked up the pressure on Kenya’s government, demanding it relinquish control of a national fiber network as compensation for the problems, according to Africa’s Business Daily.
However, the telco has previously said it is committed to Telkom Kenya, viewing it as a key asset in a bid to double revenues in East Africa over the next five years.