Luxembourg-base Millicom International Cellular has cancelled its agreement to sell Tigo Senegal for $129 million to local mobile phone operator, Wari.
Tigo Senegal a subsidiary of Millicom International Cellular was launched in 2006 and is the second largest mobile service provider in the country , with 3.2 million customers (population 13.7 million – WB 2014).
According to an official statement from Millicom, it had “exercised its right” to terminate the agreement it had earlier struck with Wari in February for $129 million.
Millicom’s operations in Senegal will now be sold to a consortium consisting of NJJ Capital, Sofima (a telecoms investment vehicle managed by Axian Group) and Teyliom Group, subject to customer closing conditions and regulatory approvals.
NJJ is controlled by Xavier Niel, the founder of Iliad, and the company holds “various stakes in a broad range of companies in Europe and the US”, said Millicom.
In February 2017, the Marketing Director of Tigo Senegal, Joyce S. Gotta revealed that the withdrawal of Millicom International Cellular (MIC) from Senegal was part of the overall strategy of the group to gradually get out of Africa and invest a little more in some other areas in Latin America where the business is far more profitable .
In its progress report for 2016, the MIC group revealed the performance of African market((Senegal, Tanzania, Ghana, Chad and Rwanda) was impressive. The African market generated operating cash flow of $ 97 million.
However, Mauricio Ramos, the Chairman and CEO of the telecom group, says the decision to sell Tigo Senegal was necessary due to the strong competition in Africa.
This competition, he explained, had forced the company to focus on markets in Latin America (Colombia, Guatemala, Paraguay, Honduras, El Salvador, Bolivia and Costa Rica) which have greater potential.
Millicom currently provides mobile services to more than 57 million customers and its business focuses on Latin America and Africa.