Potential investors who were interested in buying Orange Uganda have pulled away after acquiring information that the telecom operator was about $200 million in debt and has thin asset base and the underlying financial value is perceived as too small to justify the offer prices made to investors.
This comes after Orange Uganda sold it’s masts to Eaton Towers Ltd which left the company with less technical infrastructure units.
Reports from the East African say Orange Uganda failed to secure a buyer and resorted to minority investors who would inject in the telecom more than $41 million for new projects, the commercial option to this is expected to reduce recapitalisation pressures and raise the company’s capacity to satisfy changing consumer needs.
With this, the telecom is buying time before exiting but the inability to get a buyer would put pressure to the French major investor to discount their offer as they are already existing Africa.
The telecom’s key performance indicators remain weak. The company is yet to reap profits with net losses averaging between Ush50 billion ($19.6 million) and Ush70 billion ($27.5 million) per year since 2009, according to insiders at Ernest and Young, the firm’s auditors.
Telecom analysts say Orange Uganda’s customer base is not attractive to older rivals. Their total subscriber base is estimated at one million, compared with MTN’s 8.5 million and Airtel’s 7.2 million subscribers reports Pc Tech Magazine.