The Competition Authority of Kenya (CAK) has authorized the proposed merger of Airtel Kenya and Telkom Kenya.
This is a culmination of a long process since the initial announcement of the merger. There was a point the Communications Authority suspended the merger between the two entities while back in August, they hinted that the merger will happen before 2020.
Well in a gazette notice published today, the government institution announced this authorization, but it includes specific conditions.
- The merged entity shall not sell or transfer their operating and frequency spectrum licences within the remaining duration of their licences.
- If the merged entity operating licence expires, the 900MHZ and 1800Mhz spectrum acquired from Telkom shall revert back to the government
- The merged entity is restricted from entering into any form of sale agreement within the next five years.
- The merged entity shall honor all the existing contractual terms with GoK entities
- The merged entity shall only access the 4,204km of fiber managed by Telkom on behalf of GoK at the current market rates and no preferential rates shall be accorded to them unless provided for in existing contracts.
- The merged entity shall not enjoy any preferential access to use capacity on the 4.204km of fibre managed by Telkom on behalf of the Government.
- The merged entity shall ensure that at least 349 out of the 674 employees are retained
- The merged entity to annually furnish the Authority with a detailed report on compliance with the above conditions.
Earlier in the year, they hinted that upon approval, the entity will be called Airtel-Telkom while Telkom will continue operating in the ICT sector providing certain services to select customers.
According to the latest Commiunications Authority of Kenya statistics, Airtel has 12.8 million customers while telkom has 4.2 million customers. Combined, they will have a total of 17 million customers which is slightly over half what Safaricom has (33 million customers.).