Rostam, Axian Group to invest Sh1 trillion to expand Tigo and Zantel

Tigo owner Rostam Aziz (right) addresses journalists on plans he and his co-owners have regarding expanding the telco in rural areas as well as generally improving its efficiency, whereby together they plan to invest about Sh1 trillion. Left is founder and chairman of the board of Axian Telecom Hassanein Hiridjee. PHOTO | MICHAEL MATEMANGA

By The Citizen Reporter

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Dar es Salaam. The new owners of the local telecommunication companies Tigo and Zantel yesterday outlined their future plans, revealing how they would invest over

Sh1 trillion to go rural.

Recently, a consortium led by Axian Telecom and prominent Tanzania businessman Rostam Aziz acquired MIC Tanzania PLC which owns Tigo and Zantel.

Mr Aziz and Axian Group’s chief executive officer Hassanein Hiridjee, who addressed reporters yesterday, said they would push to strengthen network coverage, especially in the rural areas where there is potential.

“We will make sure Tigo and Zantel increase coverage to rural areas,” said Mr Aziz, who is also the chairman of MIC Tanzania, said.

“Following decades of experience in this sector, I’m committed to providing valuable strategic guidance and stewardship to Tigo in order to extend access to affordable mobile services and drive digital inclusion across rural Tanzania through significant investment in our telecom infrastructure. We will invest more than Sh1 trillion to meet our targets,” he said.

Mr Aziz was happy as a Tanzanian to partner with foreign investors in owning a big telecommunications firm.

“We normally see big companies owned by foreign investors but this time a Tanzanian is doing it in partnership with foreigners. I would encourage my fellow Tanzanians to change mindset and come out for partnerships.”

“Our economy cannot grow without foreign investors who have capital and technology but the best approach for the locals to benefit is through such kind of partnership. Let’s change our mindset that owners of big companies should always be foreigners. We can partner with them and the government should support us,” said Mr Aziz.

Speaking during the same event, the Axian Telecom’s founder and chairman Hiridjee said he was happy to have a local partner in the ownership of MIC Tanzania.

“Our investment into the merged entity will help us fulfill our ambition to be an end-to-end partner in Africa’s digital transformation journey and further accelerate financial inclusion, capitalising on the success of the company’s mobile financial services to develop bespoke services that meet our customer’s needs,” he said.

Plans are underway for the merged entity teams to move into the PSSSF Commercial Complex located along Sam Nujoma Road in Dar es Salaam.

Listing requirement

When asked about the possibility of offloading some shares of Tigo to the public as required by the Electronic and Postal Communications Act, Mr Aziz said they can do it to obey the law but he personally had different views on the matter.

He said offloading shares and subsequent listing on the stock market should be voluntary for shareholders, depending on the market forces.

“In my views, offloading shares should be a decision of the owners instead of making it mandatory by law. Look at Vodacom which already listed its shares and they are not doing well. I hope the policy makers will review the law and let the business principles to rule,” said Mr Aziz.

Tanzania is home to 54 million mobile subscribers by December 2021, according to the Tanzania Communications Regulatory Authority (TCRA).

Tigo accounts for 24.7 percent market share, making the third after Vodacom (29.4 percent) and Airtel (27.2).

As for a firm going by the name Halotel – the newest entrant to the Tanzanian telecom market – it holds 13.3 percent followed by the state-run TTCL (3.4 percent) and Zantel (2 percent).