“Minister Sam George reveals details of Airtel-Tigo’s US$400m debt restructuring during a press briefing in Accra.”
Adnan Adams Mohammed
Government of Ghana is negotiating with ATC over a mounting debt inherited for acquisition of Airtel-Tigo by the previous NPP administration for a ‘haircut’ arrangement.
The debt, which stands at US$ 400 million has been reduced to US$ 200 million, but with a cash payment component of US$ 10 million which is to be paid over a period of time, the Minister for Communications, Digital Technology and Innovation, Samuel Nartey George has revealed.
However, the company continues to face financial challenges, with monthly operating losses amounting to GH¢20 million as the Minister has criticized the previous government’s acquisition of Airtel Tigo, which was rebranded as AT, for a reported purchase price of US$1. He described the decision as “ill-informed and reckless,” highlighting that the company had a debt portfolio of US$400 million at the time of purchase and lacked sufficient revenue to cover its overhead costs.
“The previous government acquired Airtel Tigo and rebranded it as AT with a reported purchase of US$1. Nothing could have been more disingenuous and unpatriotic. When the company was bought its debt portfolio stood at US$400million and its revenues could not meet its monthly overheads”, Sam George told journalists at a Meet-the-Press event in Accra, last week.
“The core and dealing platforms have reached the end of life and neither Bharti, which operated Airtel, nor Milicom, which operated Tigo, had failed to make any meaningful investments in both companies over the preceding five years.
“The decision to step in at the time can best be described as ill – informed and reckless. It was an abdication of responsibility by the then administration and minister to the best interest of Ghana.”
“…Today after a debt restructuring arrangement, the debt portfolio at AT sits at about US$200million, rising every month as the company makes a monthly operating loss of GHc20million.
“The bleeding needs to be stopped and urgent steps are underway to engage the company’s creditors in negotiating haircuts to ensure the company’s viability,” Sam George stated.
