Kencell. This licence was granted pursuant to section 25 of the Kenya Communications Act, 1998 (KCA). Consequent upon the grant of the licence KenCell commenced mobile services in September, 2000 and were expected to commence payphone services in November, 2000 and roll-out a total of 300 payphones by 31st December, 2001. Millionaire businessman Naushad Merali may have made a killing from the transaction that saw Celtel International buy the interests of Vivendi Telecom International in mobile firm KenCell Communications. As the conclusion of the deal was being announced, one issue that intrigued pundits was the fact that the parties involved gave different figures for the price of the acquisition. According to a press statement from Celtel, it paid $250 million to acquire the majority stake in KenCell.
Back in the year 2000, Kencell was the early adopter of mobile services with voice and data services taking Kenya by storm. Safaricom launched its mobile services 6 months later but would experience early setbacks with network deficiencies and technical teething problems.
Kencell’s strategy was to target the wealthy with post-paid services and per-minute billing. This turned out to be their undoing as Safaricom set up a per-second billing system that reflected the behaviour of the Kenyan consumers. Safaricom branded itself as the cheap alternative, with marketing copy stating “Why pay for a whole minute when you can pay for only the seconds you talk?”. Kenyans began subscribing en masse.
This began the war or words as Kencell launched an ad campaign poking at the perception of Safaricom’s network problems. Billboards and full-page news ads depicting a green and pink split with the labels ‘Congested’ written on the green (symbolizing Safaricom) and ‘Connected’ on the pink.
Yet a statement from Vivendi International to its shareholders the day before said that Celtel paid out $230 million to buy 60 per cent of KenCell.
“Vivendi International today announced that its subsidiary, Vivendi Telecommunications International, has sold its 60 per cent stake in KenCell for a cash sum of $ 230 million,” said Vivendi, disclosing that the shares had been sold to Merali’s Sameer Investments group.
The statement by Vivendi also announced that the “the full amount” was collected on the same day (Monday).
On the face of it, the circumstances suggest that Mr Merali acquired the shares for $230 and then off-loaded them to Celtel International for a cool $250 million.
BusinessWeek has also learnt that Mr Merali had incorporated a company in the Netherlands – where Celtel International is domiciled – by the name Sameer BV, to serve as a special purpose vehicle for the transaction.
This suggests that the shares were initially sold to this firm, and then transferred to Celtel.
How did MTN, which was largely viewed as the frontrunner in the battle for the Vivendi stake in KenCell, lose the deal? Opinion is divided.
One theory has it that the South African company made the mistake of concentrating on negotiations with Vivendi, while ignoring Mr Merali; that even though MTN were fully aware that Mr Merali had pre emption rights over KenCell shares, they assumed that he would not excercise those rights.
Here is a List of companies that Kencell Kenya Transformed Into within 20 years
Celtel was a telecommunications company that operated in several African countries. It was founded by Sudanese-born Mo Ibrahim. Originally known as “MSI Cellular Investments”, the company began operating in 1998. In January 2004, the company name was changed to “Celtel International”.
In April 2005 the company was acquired by and became a subsidiary of Zain (formerly the Mobile Telecommunications Company). At the time it was purchased by Zain in April 2005, Celtel had about 24 million subscribers in 14 African countries. On 8 June 2010 the company was purchased by Bharti Airtel from Zain. On 22 November 2010, it was rebranded as ‘Airtel’.
In September 2006 Celtel launched “One Network”, the world’s first borderless network across East Africa, this was possible due to the Gateway license for Data which Kenya Data Network had acquired. KDN provided Celtel with a cross border link to Uganda and with trunk capacity to Belgacom. With these links Celtel was no longer required to pass its traffic through the gateway of the monopoly in Kenya. One Network enabled its subscribers in Kenya, Uganda and Tanzania to roam free between these countries, thereby scrapping roaming charges, making calls at local rates, receiving incoming calls free of charge, and recharging with local top up cards.
In June 2007 Celtel’s One Network was extended to Gabon, the Democratic Republic of Congo, and Congo. The One Network automatically activated upon crossing the geographical border into one of the six countries with no prior registration or sign-up fee.
Mobile Telecommunications Company K.S.C.P. (doing business as Zain), is a Kuwaiti mobile telecommunications company founded in 1983 in Kuwait as MTC (Mobile Telecommunications Company), and later rebranded as Zain in 2007. Zain has a commercial presence in seven countries across the Middle East with 49.5 million active customers as of 31 December 2019. The Vice Chairman and Group CEO is Bader Nasser Al-Kharafi, who was appointed in March 2017. Approximately 24.6% of the company is owned by Kuwait Investment Authority; 21.9% is owned by Omantel; only shareholders that own above 5% are disclosed. The Zain brand is one of the most recognized telecom brands across the MENA region, with a brand value in excess of US$2.3 billion.
From 2005 to 2010, Zain maintained a presence in a number of countries in Sub-Saharan Africa, in addition to its core market in the MENA region.
Zain entered Africa in May 2005 through the $3.4 billion purchase of Celtel International which had 13 country operations in Africa, serving five million customers at that time. Zain invested heavily across the continent through network upgrades and acquiring two more country licences. By June 2010, Zain had over 40 million customers across the continent, operating in Burkina Faso, Chad, Democratic Republic of the Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia.
In early 2010, Zain accepted an offer for the sale of all its Africa operations. On 8 June 2010, Zain announced that it had satisfied all required conditions precedent to closing of the sale of 100% of Zain Africa BV to Bharti Airtel Limited for $10.7 billion on an enterprise basis.
Today, Zain operates on the African continent only in Sudan, South Sudan and Morocco.
Airtel Kenya Ltd, a subsidiary of Airtel Africa (owned by Bharti Airtel), is the second largest telecommunications services provider in Kenya after Safaricom PLC. It has an estimated 16.2 million subscribers of the total 59.8 million subscribers in the Kenyan market equivalent to 27.2% market share. Airtel market share has been rising steadily over the last few years.
Airtel Kenya previously operated as Kencell, Celtel, and Zain before rebranding to Airtel in November 2010. Its current CEO is Prashanta Das Sharma. In 2010, Bharti Airtel acquired Zain Africa’s business for $10.7 billion. The acquisition deal covered Zain operations in 15 countries including Kenya but excluding Sudan and Morocco. The deal increased Bharti Airtel’s overall customer base to 180 million subscribers, including the 131 million subscribers it had in India in April 2010. In the acquisition deal, Zain received $7.9 billion in cash, with Bharti Airtel assuming $1.7 billion of consolidated debt obligations. In 2018, it was announced that Airtel Kenya was considering a merger with Telkom Kenya. Airtel Kenya backed out of the talks in June 2018.
Kencell Kenya Gallery
Kencell mobile phone airtime scratch cards in the early 2000s, when cellular technology was a new phenomenon in Kenya. Kencell is the telco that later became Celtel, then Zain, then Airtel.
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