The Airtel-Telkom Kenya merger that was first made official to the public in January 2019 has not been completed for a variety of reasons, most of which have emerged in the last couple of weeks.
Both carriers have been on a path to streamline their operations under a single entity, and even got a heads-up from the Communications Authority of Kenya (CA) just the other day. The development was, however, subject to a couple of issues: a section of fired employees sought the services of the court to compel their former employer, Airtel Kenya, to pay their send-off package amounting to KES 1 billion. The group cited delayed payments if the two carriers signed the deal.
Telkom Kenya, on the other hand, is planning to let fo 575 workers towards the end of August – although they will be given a chance to reapply for new or former positions in the newly formed company.
The merger deal has since been halted to make way for EACC investigations: it is said that it is possible public funds were misused when Treasury converted a loan it had issued to Telkom into equity during the operator’s transition from Orange to Telkom more than two years ago.
Admittedly, plans to operate the two carriers under the Airtel-Telkom name will not go on as planned owing to the mentioned concerns.
On the bright side of things, Telkom Kenya CEO Mugo Kibati has said that the exercise will be concluded before the year ends. Mugo also says that EACC’s investigations will not impact progress that has already been made, and have nothing to do with the deal. If it happens, then the two operators will have a better chance of competing fairly with the market leader, Safaricom.
Telkom CEO Mugo Kibati says merger with Airtel-Kenya to materialise before year ends; adds EACC probe on the parastatal is outside the deal.
— Ali 'Mwamvita' Manzu (@Ali_Manzu) August 28, 2019