More than 4 000 workers at Ghana Telecommunications face the chop due to Vodafone's acquisition of a 70% stake in the company. Vodafone announced yesterday it had acquired controlling shares of the national line operator.
Ghana's Parliament approved the deal, which is worth $900 million (R6.9 billion) and will see Vodafone control the largest fixed-line and broadband operator in Ghana. The group is also the third-largest mobile operator in the country.
Frost and Sullivan telecommunications analyst Lindsey Mc Donald says the acquisition could be part of Vodafone's two-pronged strategy of buying local companies with high mobile penetration in their respective countries, as well as launching its own services in those countries.
Yet there are fears the deal may lead to severe job losses in Ghana's only fixed-line operator. Officials from Ghana's Department of Communications say they will seek to protect the interests of local workers, especially the livelihood of the 4 000 Ghana Telecommunications employees.
Mc Donald says job losses are part and parcel of such deals, especially when government parastatals are privatised. "When one organisation moves from being a government parastatal to being a private company, you do see some job cuts. Yet, the benefits come when the company becomes more streamlined and operates better."
Past media reports state the Ghanaian government had plans to privatise Ghana Telecoms since 2006. It had planned to float part of the shares on the Ghanaian Stock Exchange and sell the rest to a private investor. Vodafone won the bid to buy the 70% stake, which is valued at $1.3 billion (R10.04 billion), against France Telecoms.
Over the next five years, Ghana Telecom is to invest over $500 million (R3.9 billion) in its operations and network, restoring and expanding network coverage and completing and integrating the fibre backbone. Vodafone hopes to introduce initiatives such as ultra-low-cost handsets in a country with 40% penetration of mobile phones.
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Vodafone to buy Ghana Telecom
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