Airtel Africa negotiates $200 million loan for network expansion

Kampala, Uganda | AGENCIES | Telecom firm, Airtel Africa is in talks for a $200 million loan from the International Finance Corporation (IFC), the World Bank’s arm focused on financing private sector ventures in emerging markets.

The African subsidiary of Bharti Airtel plans to utilize the funds to cover its capital expenditure (CAPEX) requirements and refinance existing debt in the Democratic Republic of Congo (DRC), Rwanda, and Kenya.

In an April 30 statement, the IFC outlined that the CAPEX component will be directed towards modernizing Airtel Africa’s telecom network. This includes purchasing active equipment for 4G sites such as antennas, software upgrades, packet core, and base transceiver station. The telecom company will also bolster its fiber optic capacity.

In December 2022, Airtel Africa already secured an initial $194 million financing from the IFC to support its operations in the DRC, Kenya, Madagascar, Niger, and Zambia. This initiative aligns with the telecom group’s growth strategy amid heightened competition in the African telecom market.

The company also aims to strengthen its balance sheet by consistently reducing group debt and localizing it within operating companies. In its financial results for the third quarter of 2023, the company set May 2024 as the deadline for full repayment of group debt.

Airtel Africa operates in 14 markets with 151.2 million customers as of the third quarter of 2023. In Rwanda, the company boasts 5 million subscribers with a 38.6% market share, compared to its sole competitor MTN’s 61.4%, according to the Rwanda Utilities Regulatory Authority.

In the DRC, Airtel holds a 29.02% market share against Vodacom (38.92%), Orange (25.64%), and Africell (6.42%), according to telecom regulators.

In Kenya, Airtel commands a 29% market share, while its main rival Safaricom holds 65.9%, as per the data from the Communications Authority