Summary of Proposed Investment
Project Number
9924
Company Name
AIRTEL UGANDA LIMITED
Date SPI Disclosed
Nov 17, 1999
Country
Uganda
Industry
Telecommunications and Technology
Status
Completed
Sector
Mobile Telephony
Department
TMT, Venture Capital & Funds
Environmental Category
C - No Impact
Previous Events
Approved : Jun 22, 2000
Signed : Oct 5, 2000
Invested : Oct 26, 2000
Project Description
Mobile Systems International Cellular Investments Holdings, B.V. (42%) is a holding company located in the Netherlands with cellular investments primarily in Africa and the Middle East. MSICIH is known to IFC as the primary sponsor of Zamcell in Zambia (IFC/R98-167), and IFC recently approved an equity investment in MSICIH (IFC/R99-151).
VEHBV (formerly Vodafone Europe Holdings B.V.) (37%) is a wholly owned subsidiary of Vodafone AirTouch plc. In June 1999, Vodafone plc merged with AirTouch of the USA to create the world''s largest and most diversified mobile operator, and in September 1999 Vodafone AirTouch and Bell Atlantic of the USA announced a joint venture to combine the companies'' wireless assets in the USA, creating a nation-wide presence. Vodafone AirTouch is involved in mobile telecommunications services in the UK, USA, Australasia, Belgium, France, Germany, Greece, Italy, Netherlands, Portugal, South Africa, Spain and Sweden, among other countries.
- Project Cost Including proposed IFC investment
The estimated project cost is $12 million, and IFC''s proposed debt and/or income participating investment is estimated to be about $6 million.
- Location of project and Description of site
The project is to improve CelTel''s nationwide mobile cellular network in Uganda. This is expected to include expanding the network capacity in the Kampala area, as well as building-out the network into new regions of the country.
- Description of Company and Purpose of Project
CelTel launched cellular services in 1995 as the first cellular operator in Uganda. At that time, IFC provided an equity investment of $640,000 and debt investments of nearly $5 million to help finance a $16.0 million capital expenditure program for CelTel to build a national GSM network in Uganda. However, demand has been greater than originally expected, spurred in part by strong competition from the launch of a second cellular operator (MTN Uganda), so the company needs to increase its network capacity and expand into new and potentially profitable areas of Uganda.
- IFC''s role would include:
- providing the company with long-term financing, which is scarce in Uganda;
- assisting in mobilizing parallel long-term financing; and
- demonstrating continued support for the development of Uganda''s emerging private sector.
The development impact of this project is substantial, with cellular telecommunications quickly becoming an important method of communications in the country. Indeed, cellular subscribers are thought to outnumber fixed lines in service at this point, increasing efficiency in the business community and connecting Uganda to the global economy.
- Environmental Category and Issues
The proposed transaction is classified a category C project according to IFC''s environmental and social review procedure. The original project was a Category B project and environmental clearance was obtained in 1994. Environmental monitoring has been proceeding during the execution of the project. In 1996, the Environmental Division reviewed an external audit of the company performed by the Ugandan Department of Environment. This report confirmed that CelTel had implemented appropriate mitigation measures in the design and construction of the project, and had addressed the key environmental and safety issues identified by IFC at the time of appraisal. Some recommendations were made and these have since been followed up with the company. The company produced Annual Environmental Monitoring Reports in 1997, 1998 and 1999, and has also adopted a formal environmental management plan, a solid waste management plan, and a health and safety plan. This project has demonstrated general compliance with the project specific environmental guidelines established by the lenders, as well as with local requirements.
CelTel are also a subsidiary of MSICIH, for whom an IFC investment was approved in September 1999 for equity of $10 million. Under the terms of this investment, MSICIH are required to produce an Environmental Management Plan which should consolidate all elements of the group''s environmental policy and operational procedures in one central management plan.
The is from the InfoShop.
“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”
For Additional Information contact:
Corporate Relations Unit
Telephone: (202) 473-7711
Fax: (202) 974-4384
VEHBV (formerly Vodafone Europe Holdings B.V.) (37%) is a wholly owned subsidiary of Vodafone AirTouch plc. In June 1999, Vodafone plc merged with AirTouch of the USA to create the world''s largest and most diversified mobile operator, and in September 1999 Vodafone AirTouch and Bell Atlantic of the USA announced a joint venture to combine the companies'' wireless assets in the USA, creating a nation-wide presence. Vodafone AirTouch is involved in mobile telecommunications services in the UK, USA, Australasia, Belgium, France, Germany, Greece, Italy, Netherlands, Portugal, South Africa, Spain and Sweden, among other countries.
- Project Cost Including proposed IFC investment
The estimated project cost is $12 million, and IFC''s proposed debt and/or income participating investment is estimated to be about $6 million.
- Location of project and Description of site
The project is to improve CelTel''s nationwide mobile cellular network in Uganda. This is expected to include expanding the network capacity in the Kampala area, as well as building-out the network into new regions of the country.
- Description of Company and Purpose of Project
CelTel launched cellular services in 1995 as the first cellular operator in Uganda. At that time, IFC provided an equity investment of $640,000 and debt investments of nearly $5 million to help finance a $16.0 million capital expenditure program for CelTel to build a national GSM network in Uganda. However, demand has been greater than originally expected, spurred in part by strong competition from the launch of a second cellular operator (MTN Uganda), so the company needs to increase its network capacity and expand into new and potentially profitable areas of Uganda.
- IFC''s role would include:
- providing the company with long-term financing, which is scarce in Uganda;
- assisting in mobilizing parallel long-term financing; and
- demonstrating continued support for the development of Uganda''s emerging private sector.
The development impact of this project is substantial, with cellular telecommunications quickly becoming an important method of communications in the country. Indeed, cellular subscribers are thought to outnumber fixed lines in service at this point, increasing efficiency in the business community and connecting Uganda to the global economy.
- Environmental Category and Issues
The proposed transaction is classified a category C project according to IFC''s environmental and social review procedure. The original project was a Category B project and environmental clearance was obtained in 1994. Environmental monitoring has been proceeding during the execution of the project. In 1996, the Environmental Division reviewed an external audit of the company performed by the Ugandan Department of Environment. This report confirmed that CelTel had implemented appropriate mitigation measures in the design and construction of the project, and had addressed the key environmental and safety issues identified by IFC at the time of appraisal. Some recommendations were made and these have since been followed up with the company. The company produced Annual Environmental Monitoring Reports in 1997, 1998 and 1999, and has also adopted a formal environmental management plan, a solid waste management plan, and a health and safety plan. This project has demonstrated general compliance with the project specific environmental guidelines established by the lenders, as well as with local requirements.
CelTel are also a subsidiary of MSICIH, for whom an IFC investment was approved in September 1999 for equity of $10 million. Under the terms of this investment, MSICIH are required to produce an Environmental Management Plan which should consolidate all elements of the group''s environmental policy and operational procedures in one central management plan.
The is from the InfoShop.
| Date SPI sent to InfoShop: | November 17, 1999 |
“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”
For Additional Information contact:
Corporate Relations Unit
Telephone: (202) 473-7711
Fax: (202) 974-4384
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