Africell exits Ugandan market after 7 years

UGANDA – Telecoms company Africell is to exit the Ugandan market, ceasing operations by 7 October 2021 due to what it terms as “long-term commercial outlook.”

In a press release, Africell said it had worked closely with the government and Uganda Communications Commission (UCC) on confirming its decision.

The details of this were not disclosed, however, GSMA has been notified of the termination of roaming partner agreements.

Africell Uganda’s statement read:  “Africell’s decision to leave Uganda is based on a careful assessment of the long-term commercial outlook for the business and its fit within the overall group strategy of driving digital transformation in the communities we serve.”

Africell said its broader group strategy is to “drive a digital transformation in the communities we serve”, and that leaving Uganda “is the most sustainable way to fulfill our overall mission to advance the African telecoms sector through competition and innovation”.

Explaining how the business will wind down over the coming weeks, Africell UG said all its mobile sites will be returned to the third parties who lease them while network technology equipment will be transferred where possible within the Africell group, while the operator’s mobile frequency and spectrum holdings will be returned to the UCC.

The business is “working directly with the UCC and other local mobile network operators” to oversee the migration process for its subscribers who will need to change providers.

On jobs, the operator employs around 60 people who will all be made redundant during the transition.

“Africell’s decision to leave Uganda is based on a careful assessment of the long-term commercial outlook for the business and its fit within the overall group strategy of driving digital transformation in the communities we serve”

However, there is a plan in place, which has been approved by the Ministry of Gender, Labour and Social Development and, according to Africell, “well exceeds minimum statutory requirements”. Reports claim it includes severance, repatriation, and continued employment until November 2021.

Africell added: “We are committed to being respectful to and transparent with our employees. We are providing benefits to employees designed to mitigate the personal and psychological impact of their job loss and help them secure new opportunities as quickly as possible.”

The Lebanon-based Africell Holdings entered the Ugandan market in 2014 by acquiring Orange Uganda and has been mostly known for its affordable internet service packages, and relative network stability.

Africell Group’s plan to launch operations in Angola remains in place with a deadline of year-end.

Earlier in August 2021, Smart Telecom also announced it was leaving the country after failing to realize its business objectives.

The management noted that their decision to quit will have a long-term impact on the telecommunication sector in Uganda, but an immediate impact on the employees.

In 2019, Africell was reported to be indebted to the tune of Ushs 250 billion (US$70.8 million), while it made a loss of more than Ushs1.5 trillion (US$425 million).

Part of the debt has been inherited from Orange when it purchased it.

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