Safaricom PLC has announced plans to launch mobile money in the federal republic of Ethiopia and make the unit its subsidiary.
Safaricom is 35 percent owned by the Kenyan government and 40 percent by South Africa’s Vodacom, while the remaining shares are publicly listed.
In a public notice to shareholders on Thursday ahead of its full-year results, the telco said it has completed talks with the Ethiopian government on how to set up the mobile financial service.
“In compliance with applicable legislations, the consortium through Safaricom Ethiopia will set up a new entity, Safaricom ET MSF to acquire Payment Instrument Issuer License (PIIL) and will offer mobile financial services under the M-Pesa brand,” the telco said in a notice.
It added that by virtue of holding the controlling stake in the consortium, the Ethiopian business will be a subsidiary of Safaricom PLC after shareholders’ approval during the annual general meeting slated for July 29.
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Safaricom launched in the Ethiopian market in October last year, becoming the first private operator in one of Africa’s largest telecoms markets. State-owned Ethio Telecom had until then enjoyed a monopoly in Ethiopia, Africa’s second-most populous country with an estimated 118 million people.
In 2021, as part of plans to revamp the telecommunications sector, Ethiopia issued a tender to award two licences to private telecommunication operators. One licence was awarded to a consortium led by Safaricom, which offered USD 850 million and promised to invest USD 8.5 million over 10 years.
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