adminthe money will be raised in March through equity financing and is the first tranche of US$200 million it plans to invest locally in the coming years. The US$100 million investment will be spread over two years.
The areas in which the firm is looking to invest include increasing its network coverage and fourth generation (4G) mobile network that has been proposed as a partnership between the government and the private sector.
Additionally, Essar of India has pumped US$155 million in the company in recent months that Madhur Taneja, the yuMobile Country Director says went towards repayment of loans that the operator had taken in its initial phases as it set up in Kenya.
“We are a debt free company. In the past couple of months, US$155 million has come from our promoters (Essar Group) to clear all loans that we had with banks and thus we no longer have debt, but equity.
“This reiterates not only the group’s confidence in our business, but also, the belief we have in the growth we can anticipate in the Kenyan market. We now need more funds that go towards network expansion and this will be raised through equity financing. The efforts to raise capital for investment are progressing in the right direction at the right pace,” Taneja said.
He added the company would be raising expansion capital in two tranches – the first will be raised by the end of March and will be used in network expansion in the course of this year.
While 4G has been downplayed by a segment of the industry as making no business sense at the moment, yuMobile says 4G network is crucial for it as it never invested in 3G and now wants to go straight to 4G.
“This first tranche of US$100 million that we expect in March this year should serve our needs for almost the next two years. Our promoters continue to invest in the company as there is high confidence in the success of the business in the long term,” the director said.
The operator started out in Kenya late 2008 and currently has a market share of 10 percent, with about three million customers as of September last year.- CAJ News.
Online Reporter