The Government of Kenya and France Telecom-Orange Strengthen the Capital Structure of Telkom Kenya
The Government of Kenya (GoK) and France Telecom-Orange have signed an agreement to strengthen the balance sheet of Telkom Kenya, their jointly owned company. This Restructuring Agreement will put Telkom Kenya on a sound financial footing that enables it to effectively implement its 5 year business plan.
The central pillars of the Restructuring discussions were that the shareholders would
(i) convert their loans to the company into equity, and
(ii) support the operational needs of Telkom Kenya for 2012 in proportion to their shareholding (51% France Telecom – Orange and 49% GOK), through the provision of Ksh. 10 billion of additional funding during the course of the year.
On this basis, and, as a consideration for France Telecom-Orange agreeing to write-off a significant part of its shareholder loan, France Telecom–Orange would increase its stake in the company from 51% to 60%.
As of the date of the Restructuring Agreement, which was signed in Nairobi on 21st December 2012, France Telecom-Orange had provided its full share of Ksh. 5.1 billion in funding for 2012. The GoK had provided Ksh. 2.5 billion of its portion of Ksh. 4.9 billion, and did not provide the balance of Ksh. 2.4 billion by 31st December 2012, the end of Telkom Kenya’s financial year.
As a consequence of the GoK not having provided its full portion of 2012 funding, the stake of France Telecom-Orange will increase at this point to 70%. However, under the Restructuring Agreement, GoK has an option to increase its stake to 40% during the second half of its Financial Year 2012/13, i.e. by June 30th 2013, through an injection of the balance of Ksh. 2.4 billion.
The new improved capital structure with shareholder equity expected to exceed Ksh. 18 billion at the end of 2012, will enable Telkom Kenya to pursue its growth over the coming years by implementing its business plan approved by the Board. More specifically, the company will continue to build upon its leadership in the enterprise market and to develop new mobile data services and technologies. This agreement reflects the confidence that both shareholders have in the company’s future and in the business climate in Kenya.
About Orange
France Telecom-Orange is one of the world’s leading telecommunications operators with sales of 45.3 billion euros for 2011 and has 170,000 employees worldwide at 30 September 2012, including 105,000 employees in France.
Present in 33 countries, the Group has a total customer base of 227 million customers at 30 September 2012, including 169 million mobile customers and 15 million broadband internet (ADSL, fibre) customers worldwide. Orange is one of the main European operators for mobile and broadband internet services and, under the brand Orange Business Services, is one of the world leaders in providing telecommunication services to multinational companies.
France Telecom (NYSE:FTE) is listed on NYSE Euronext Paris (compartment A) and on the New York Stock Exchange.
For more information (on the internet and on your mobile): www.orange.com, www.orange-business.com, www.orange-innovation.tv or to follow us on Twitter: @presseorange.
Orange and any other Orange product or service names included in this material are trade marks of Orange Brand Services Limited, Orange France or France Telecom.
Press contacts:
France Telecom-Orange
Tom Wright, +33 1 44 44 93 93, tom.wright@orange.com
Olivier Emberger, +33 1 44 44 93 93, olivier.emberger@orange.com
Post a Comment