AccessKenya ups the ante and Zain Kenya’s Merali ditches equity.
In the news this past week, AccessKenya has announced that it is now fully operational on the SEACOM high speed under sea cable. As a direct consequence, AccessKenya has doubled Internet bandwidth for all of its customers at the same prices that they have been paying to-date. AccessKenya has also announced that it has acquired 2500 megabits capacity on SEACOM as a well as similar capacity on the yet to go live TEAMS cable. This means that AccessKenya will have a total of 5000 megabits Internet bandwidth capacity by the end of September 2009 when TEAMS is expected to go live. AccessKenya has also invested significantly in building out its last mile infrastructure using various wireless and fiber technologies, ultimately giving them an end-to-end Internet service by owing the entire bandwidth delivery channel. Incidentally, we use AccessKenya at work and over the past couple of weeks we have had been experiencing much faster Internet speeds, for a change.
In other news last week, Naushad Merali who owned 20% in Zain Kenya quietly sold around 15% of his shareholding in the struggling mobile network sometime earlier this year. Could this be a sign that Zain Kenya is in much larger trouble than they may be letting on? The point here being that Kenya has one of the largest and fastest growing mobile telecoms sectors with close to 18 million subscribers currently. Therefore, for Naushad Merali to ditch such a substantial chunk of his equity in Zain Kenya it can only mean that a storm is brewing and he bailed out before the sailing got too rough. Whatever the case, it looks like Zain Kenya has a tough road ahead as their market share has remained marginal to dominant Safaricom. It also doesn’t help that Zain is looking to sell their Pan-African operations to a suitable buyer but no one seems to biting, yet.