Airtel, Telkom protest CAK merger terms

Telkom CEO Mugo Kibati when he appeared before the Senate Committee on Information last October over the merger. PHOTO | DIANA NGILA  

By PATRICK ALUSHULA
More by this Author

Summary

• The two telcos want a review of among other conditions, the order to not lay off any worker within the first two years or sell any assets of the resultant entity within the first five years.
• Both have written to the Competition Tribunal protesting CAK’s conditions that were imposed in the merger nod that was issued on December 13, 2019.
• Airtel and Telkom want to be given a free hand in entering and executing sale agreements at any time as opposed to CAK’s order.

Airtel and Telkom Kenya want the Competition Authority of Kenya (CAK) to drop most of the conditions they were ordered to fulfil before and after their proposed merger.

The two telcos want a review of among other conditions, the order to not lay off any worker within the first two years or sell any assets of the resultant entity within the first five years.

Both have written to the Competition Tribunal protesting CAK’s conditions that were imposed in the merger nod that was issued on December 13, 2019.

“The Competition Tribunal invites interested parties to make submissions/proposals/comments to the Tribunal in regard to the application for review within the next 30 days," chairperson for the tribunal Stephen Kipkenda said in the latest Kenya Gazette notice.

Airtel and Telkom want to be given a free hand in entering and executing sale agreements at any time as opposed to CAK’s order. 

They also want CAK to drop the condition that bars them from selling the four frequency spectrum licences and five operating licences including a submarine cable landing licence.

The move signals that the two entities may want to use the merger as a stepping stone to other financial transactions post-merger.

They further want to be given green light to cut employee size after one year of merger as opposed to CAK’s set period of two years. If granted, it could mean early job losses to the employees of the two entities.

Airtel and Telkom had argued that they needed to secure more telecoms frequencies to better compete with the market leader, Safaricom.