Telkom Kenya is targeting to raise at least Ksh3.87 billion through the sale of its properties in the country, an amount that will be contributed to the proposed merger with Airtel.
Through Axis Real Estate, the telco is seeking to sell 17.8 acres of land, a move it says has received a nod from shareholders.
“Under the transaction, Telkom is required to contribute funds in cash to the combined entity. Both entities in the transaction will contribute cash, for purposes of the transition and the integration of systems and network elements,” Telkom told Business Daily, without revealing the amount it is required to contribute.
A total of 32 proprties have been put on sale to raise the cash, aimed at precludind the option of a bank loan.
“The intention will be to market a list of properties, with the prospect of selling a number that will enable the business raise just the amount of funds required,” added the telco.
Business Daily reports that of the 32 properties on sale, only six are empty plots while the rest are developed as commercial buildings and telephone exchanges. Properties on sale from Ruaraka, Muthangari and Lang’ata, are freehold while the rest are leases from the government and counties but owned by Telkom.
Others are in Bungoma, Embu, Kirinyaga, Kiambu, Kisii, Meru, Murang’a and Kajiado counties while in Mombasa the Makupa Exchange’s lease is held by Yusufali Jiwaji.
Telkom Kenya sold its 723 masts for Ksh17.16 billion to American Tower Company (ATC) last year, while Airtel sold 1,100 mobile telephone masts to a UK infrastructure firm for Ksh19.5 billion in 2014.
Telcom and Airtel announced a merger early this year, a move that has seen several employees lose jobs.
Helios Investment owns 60 per cent of Telkom Kenya Limited while the Kenyan government owns the remaining 40 per cent.
With the new arrangement, Telkom Kenya’s key shareholder Helios will retain 40 percent, Kenyan Government 10 percent while Bharti Airtel will be the majority shareholder with 50 percent. The new entity will be called Airtel-Telkom.