Orange to take a breather from acquisition spree in Africa

Orange has been one of the most expansionist operators in Africa, particularly the French-speaking north and west regions. However, it aims to slow the pace of acquisition and rely on partnerships instead, to expand its current footprint in 21 countries any further.

MNOs in Africa increasingly need to reduce costs in a low margin region, particularly by sharing investment in infrastructure, said Bruno Mettling, Orange’s deputy CEO in charge of operations for Africa and the Middle East.  Addressing the CEO Africa conference in Ivory Coast capital  Abidjan, he said: “That’s what we’re doing in sharing our network, our infrastructure with other partners, to optimize the expenses.”

Orange invests about €1bn a year in Africa, but will now concentrate the bulk of those funds on building on its existing presence rather than adding new markets. That will help it operate efficiently, gain market share and take optimum advantage of the high growth rates in some of its territories. For instance, Mettling said, its most recent acquisitions – in Sierra Leone, Burkina Faso and Liberia – currently represent 8% of total revenue for the French group, but about one-third of its subscriber growth.

“Of course there are some opportunities of consolidation, but it’s not Orange’s priority,” he said. “The priority is to consolidate the market where we are present and make the integration of the new countries a success.”

The operator is also looking to improve cost efficiency and environmental friendliness, while extending its services to new markets, by distributing 20,000 solar kits in seven African countries in partnership with UK-based renewable energy firm BBOXX. It targets selling between 400,000 and 500,000 Orange Energie kits in the next five years.

It kicked off this sustainable energy initiative in Democratic Republic of Congo and Madagascar last year, and will now widen it to Burkina Faso, Senegal, Mali, Guinea and The Ivory Coast.

“Orange wants to be much more than a telecoms operator in Africa. We want to be a provider of essential services for our customers. The development of solutions that allow as many people as possible to access everyday essentials such as sustainable energy is a strong message in this direction,” Mettling said.

Comprised of a solar panel, battery and accessories, the kits can generate enough power to light a house, charge mobile phones or power a television or radio. Subscription to the service starts at $15 per month.