Airtel and Telkom Kenya faced a delay to completing a planned merger, after an anti-corruption watchdog pushed back the deadline for completing its investigation of the deal.
The companies aimed to close the transaction by 27 September, however the Ethics and Anti-Corruption Commission (EACC) instructed regulators to suspend the merger until it finishes its assessment.
Airtel and Telkom Kenya are the second- and third-largest operators in the country, respectively. The merger would boost their competitive edge against market-leader Safaricom, by reducing operating costs and increasing economies of scale.
EACC’s move is the latest stumbling block for the deal, which was first announced in February [1].
In March, a committee in Kenya’s National Assembly said the deal had “all the hallmarks of a scandal [2]” noting it enabled private individuals to acquire a public company “through the backdoor for a song”.
A month later, Telkom Kenya announced it would not take on Airtel’s debt [3] as part of the deal, a factor Safaricom later picked up on as it urged regulators to closely scrutinise [4] the deal.
[1] https://www.mobileworldlive.com/featured-content/top-three/airtel-agrees-merger-with-telkom-in-kenya/[2] https://www.mobileworldlive.com/featured-content/top-three/airtel-telkom-kenya-merger-hits-stumbling-block/
[3] https://www.mobileworldlive.com/featured-content/top-three/airtel-stays-clear-of-telkom-kenya-debt/
[4] https://www.mobileworldlive.com/featured-content/top-three/safaricom-chief-tackles-merger-concerns/
