Bharti Airtel has agreed to acquire Tigo Rwanda from Millicom. The acquisition will consolidate the Rwandan telecom market and position Airtel as a strong number two, after market leader MTN. The consideration for the transaction values Tigo Rwanda at 6x adjusted EBITDA for 2017, payable over two years.

The agreement is subject to regulatory and statutory approvals. Under this deal, Tigo’s 3.70 million customers will join the network of Airtel Rwanda. The acquisition will make Airtel Rwanda the second largest operator in the country with revenues of over USD 80 million and a revenue market share of over 40 percent, the company said. 

Sunil Bharti Mittal, Chairman of Bharti Airtel, said Airtel has taken proactive steps in Africa to consolidate and realign the market structure in the last few remaining countries where its operations are lagging on account of lower market share and presence of too many operators. Mittal said Airtel and Tigo have already merged their operations to create a strong viable entity in Ghana and have again taken an important step in the acquisition of Tigo Rwanda. 

According to Mittal, Airtel is also committed to the long term viability of its operations in Kenya and Tanzania, to ensure that in 2018 all its 15 operations in Africa start contributing positive margins and cash flows. In the past year, Airtel acquired assets in Uganda (Warid), Congo B (Warid) and Kenya (yu Mobile) and consolidated operations in Ghana (Millicom). 

The sale sees Millicom withdraw further from Africa, in order to focus on its operations in Latin America. After the Ghana and Rwanda deals with Airtel, selling its DRC operations to Orange and the pending sale of Tigo Senegal, the company will be present only in Tanzania and Chad in Africa.