France Telecom fortifies African presence

France Telecom has taken control of Senegal’s leading operator, Sonatel, through the acquisition of a further 10 per cent stake from the country’s government.

The French carrier and the Senegalese state said Wednesday that they have signed an agreement that will see France Telecom acquire a further 9.87 per cent of Sonatel’s total capital, taking its own holding in the operator from 42.3 per cent to 52.2 per cent. France Telecom will pay Eur209m for the stake.

After the deal, the Senegalese government will remain Sonatel’s second biggest shareholder with 17.28 per cent of the operator’s capital.

Commenting on the move, Michael Kovacocy, European telecoms analyst and sector strategist said that with 3.8 million customers in Senegal and a further 3.4 million customers in surrounding countries as of year-end 2008, the deal represents approximately Eur294 per current customer acquired, “which looks a decent price to pay in our view, especially given growth prospects in the region.”

Kovacocy also views “very favourably the emphasis on buying growth in Africa, which we believe allows France Telecom to buy solid long-term growth prospects with less risk currently of overpaying.”

Earlier in the week, France Telecom also upped its holding in Egyptian mobile carrier Mobinil, after settling a lengthy legal dispute with local operator Orascom Telecom and shelling out Eur530m for Orascom’s holding in Mobinil.

However, the company’s move to take full control of the Egyptian carrier was scuppered after the Egyptian Capital Market Authority (CMA) rejected France Telecom’s offer to buy out the minority shareholders.