India's Essar Group Takes Majority Stake in Kenyan Operator

­India's Essar Group has reportedly taken control of the Kenyan mobile network, yu, after buying out Econet Wireless's holding in the company. Essar Telecom Kenya now has an 80% stake in the company.

Essar Telecom Kenya chief executive officer Srinivasa Iyengar told the Daily Nation that "Previously, we had a 35 per cent stake which was holding us back in accessing funds from lenders. But now we have enough money to see us through our expansion programme," said Mr Iyengar.

Last year, Econet Wireless International (EWI) sold a 49% stake in the company to India's Essar Communications Holdings (ECHL). The companies said that the move would significantly benefit Econet Wireless Kenya (EWK), which is 70% owned by EWI, from a rollout as well as product offering perspective.

He said that the entire yu network rollout is costing US$450 million out of which US$200 million is equity through the Essar Group. "We have already received US$50 million funding and the rest will be coming in phases in a five-year plan," he said. Earlier this week the company announced that it had just completed a national coverage rollout.

He also added that the company is in talks for possible takeovers in Uganda and Congo.

On the web: Daily Nation

Posted to the site on 3rd September 2009