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THE Kenyan government has granted Econet Wireless Kenya (EWK) a two-month extension of its rollout deadline following a petition to the Kenyan government in a development that will give the mobile operator more time to launch its network on the market.
The initial deadline would have expired last month but the Information Permanent secretary Dr Bitange Ndemo told Business Daily, Kenya’s premier financial paper that EWK had asked for an extension in view of the post-election violence that rocked the country at the beginning of the year. Reports from Kenya said EWK mandatory local shareholding issue is being challenged by its erstwhile partner— the Kenya National of Federations of Co-operatives — after the lead promoter decided to change its associates in Kenya. Elizabeth Yoga, EWK spokesperson, told Standardbusiness the slow start of operations in Kenya is "due the unfortunate unrest at the beginning of the year coupled with the problems at the port of Mombasa". But she said the company was determined to deliver "an excellent and differentiated service". "The political and regulatory authorities in Kenya have been most supportive of our launch plans and readily accepted our petition," Yoga said. Econet Wireless International (EWI) owns 70% in EWK, while other shareholders include: Starnet Limited (26%); Corporate Africa (2%); and Crosslink (2%). In December 2007 Essar Telecom Holdings International bought 49% stake in EWI which has shareholding in EWK. EWI has operations on four continents: Africa, America, Asia Pacific, and Europe. Yoga said the change in the shareholding of EWI did not affect the local shareholding in Kenya’s third mobile licence holder. EWK has begun its rollout plan after the mobile operator launched a hunt for at least 12 national distributors. In a notice in one of Kenya’s newspapers, EWK said the distributors should have minimum turnover of Sh240 million per year in the last three years. The distributors should be ready to implement activities geared at growing subscriber numbers nationally, EWK said. EWK was licensed in 2003 but was able to roll out its operations due to protracted court battles involving its ownership. These battles came to an end in 2006 two years after it agreed to withdraw the cases it had filed against Communications Commission Kenya (CCK) and then Information Minister Raphael Tuju. The latest drive to launch the company’s brand started last September, when Econet paid the balance of Sh840 million of its Sh1.9 billion licence fee and took on board new partners. In July, the company intensified its effort to rollout the network by appointing executives to drive the programme ahead of the July 30 deadline set by the CCK. Michael Foley, a former executive at Essar, was appointed CEO of the mobile service provider. Shailendra Khare was appointed chief technical officer, while Philip Mudimu took over as the project director. Anne Othoro was poached from Celtel Kenya to assume a similar position as marketing director in the mobile firm. EWK will battle it out with Nairobi Stock Exchange-listed Safaricom and Celtel who have dominated the Kenyan mobile service for a decade. By Ndamu Sandu
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