Dhabi Group sells African telecoms stakes

Dhabi Group has sold a majority stake in its two largest African telecommunications networks, reports The National.

The stake is being bought by the Essar Group of India. The two companies did not disclose the price, but said the networks, in the Republic of Congo and Uganda, were worth $318 million.

Essar operates India's third-largest mobile network, in a joint venture with the UK's Vodafone Group. The company claims expansion into Africa will be a priority.

Zain has attributed the drop in its profit to financial fluctuation and network expansion, especially in its African operations, states 234Next.com.

Zain Group CEO, Saad Al Barrak, says: "The global economic crisis, unfavourable foreign currency fluctuations, particularly in many of our African operations, coupled with reduced interest income and investment income plus higher financing costs, have had a significant impact on the company's overall profit.”

Zain also blames the operational expenditures in two large operations that were rolled in the last 12 months, in Saudi Arabia and Ghana.

New analysis from Frost & Sullivan finds the West African market earned revenues of over $420 million in 2007 and estimates this to increase four-fold by 2014 to reach $2.2 billion, says Newswire Today.

The research firm says despite developments in broadband in the region, issues relating to affordability and literacy, coupled with the limited financial capacity of operators to invest in infrastructure, hamper market growth.

Frost & Sullivan industry analyst Spiwe Chireka says: "Historically, broadband development in the region has been driven by fixed-line incumbents but, through wireless technologies, Internet service providers can circumvent the slow or stagnant development of fixed-line infrastructure."