Competition Authority Nods To Airtel-Telkom Merger, But With Conditions

The Competition Authority of Kenya (CAK) has allowed Airtel Kenya and Telkom Kenya merger.

However, the merged entity shall not sell or transfer their operating and frequency spectrum licences within the remaining duration of their licences.

According to a gazette notice issued by the authority, 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.

Read: Safaricom Using EACC To Stop Airtel-Telkom Merger – Kibati

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.

Telkom and Airtel announced their merger on February 8, to form a formidable entity that would rival giant telco, Safaricom and the deal was meant to finalise before December.

“We are staring at a possibility of a monopoly that leaves consumers with no choice for alternative products as well as investors at a distance to invest in such a market,” Kibati said.

Safaricom wrote to the Communications Authority opposing the intended merger of businesses, citing concerns that it wanted to be addressed first.

“We have no quarrel at all with our colleagues at Safaricom, we are simply trying to restructure and improve our own business and for the good of the industry. It is unfortunate, however, that Safaricom now wants to delay this process that seeks to provide customers with more credible options,” he added.

Currently, it is estimated that Airtel has 12.8 million customers while telkom has 4.2 million customers.

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