For an undisclosed amount, Safaricom has taken over Essar’s Yu undersea cable on The East Africa Marine System (TEAMS).
Safaricom says that this move will enable it to provide faster internet speeds and also upgrade their service to the 4G level.
This brings the company’s shareholding to 32.5 per cent with the rest being: Kenya government (20 per cent), Telkom Kenya (20 per cent), Kenya Data Networks (10 per cent) and Jamii Telecom (6.25 per cent).
The troubled Yu Network opted for the buyout to increase its cash flow.
“The stake was sold to Safaricom in September at undisclosed figure. The finances from this sale went towards yuMobile’s operations,” said Madhur Taneja, the Essar Kenya CEO.
“It was an investment made by Essar, which was not being used for operations. This bandwidth had always been idle since we acquired it five years ago.”
This new revelation, heightens speculations on the future of the Essar company. Months ago the company said that it was looking for a strategic partner to pump in cash for its operations. Many telecom companies, including Warid Telecom were rumoured to be in talks with the company.