October 21, 2008

France Telecom Sets Up Uganda JV

France Telecom has formed a joint venture in Uganda with mobile operator Hits Telecom Uganda which already has a full telecommunications license and GSM network.

The joint venture will be called Orange Uganda. France Telecom will own 53% and contribute half of the $200m investment planned over the next three years for network expansion across the country where it will compete with MTN, Celtel, Uganda Telecom, and Warid telecom.

France Telecom is looking at emerging markets with low mobile penetration for expansion. Last year it acquired a 51% stake in Telkom Kenya for $540m and lost out to Vodafone in the privatization of Ghana's incumbent operator.

Anne Bouverot, head of international development at Orange, said: "Uganda presented a good opportunity for France Telecom, with mobile penetration unusually low at just 17%. A large population and growing economy made Uganda a market with a high potential for growth."

It has also won the tender for a third cellular operator in Armenia where said it will invest $270m and open offices in 42 cities.