BY JOAN WANJIKU,NAIROBI,13TH DEC 2019-The competition authority of Kenya (CAK)on Friday approved the planned merger of two telecommunications companies Airtel Kenya and Telkom Kenya.
The Authority gave its greenlight for the deal while setting out a raft of conditions including ensuring it retains a number of its employees.
“The merged entity shall ensure that at least three hundred and forty nine (349) of the six hundred and seventy four (674) employees of the target are retained as follows —
(a) 120 employees by the merged entity for a period of two years from the date of the implementation of the merger (b) 114 employees by Telkom Kenya Limited for a period of two (2) years from the date of the implementation of the merger; and (c) 115 employees to be absorbed by the network partners of the merged entity,” CAK boss Wang’ombe Kariuki said.
The company, which will be called Airtel-Telkom, is also required to honour all existing government contracts.
The merged entity will not be allowed to sell or transfer some of its operating and frequency spectrum licences until their duration expires.
“Upon expiry of the term of the merged entities’ operating license, the spectrum in the 900MHZ and 1800MHZ acquired from Telkom shall revert back to the Government of Kenya (GoK),” the notice says.
The companies had earlier said that Telkom Kenya’s real estate portfolio and specific government services would not form part of the combined entity under the deal.
As per the directive Airtel-Telkom will also not be allowed to enter into any other sale deal in the next five years as part of conditions for the merger’s approval.
“However, in the event of any indication of a failing firm within the period, the Communications Authority shall conduct a forensic audit at the cost of the merged entity,” the regulator said.