ANNOUNCEMENT 30 Jun 2012In June 2012, the government of Kenya announced a change in private-sector financial support.
NUMBER OF INTERVENTIONS
Kenya Television Network (Finance Minister Speech): http://www.standardmedia.co.ke/ktn/index.php?videoID=2000061848&video_title=News-:-Telkom-Kenya-to-be-restructured
Kenya Broadcasting Corporation: http://www.kbc.co.ke/news.asp?nid=79152
Business Daily: http://www.businessdailyafrica.com/Corporate-News/Telkom-Kenya-moves-to-reclaim-data-space-/-/539550/1451548/-/uyxyli/-/index.html
Daily Nation: http://www.nation.co.ke/business/stocks---forex/Cabinet-approves-plan-to-convert-Telkom-loan-into-shares/-/1008/1626970/-/jwiu7ez/-/index.html
Affected trading partners:
On 30 June 2012, the Kenyan Government approved a recapitalisation plan for Telkom Kenya (49% government owned, France Telecom being the other major shareholder). The Treasury and France Telecom agreed to each inject 5 billion Shillings (57.6 million USD) in the company. The Treasury decided to convert its share of Telkom debt into equity, which effectively recapitalises and restructures the balance sheet of the company. This restructuring allows to borrow additional funds more easily.
The measure mainly discriminates against the othertwo major players in the sector Safaricom (with Vodafone as a main shareholder) and Econet Limited (with Essar Communications as a main shareholder).