x Abu Dhabi, UAEMonday 24 July 2017

Abu Dhabi Group and Essar in African venture

The investment company led by members of the Abu Dhabi royal family will partner with India's Essar to expand into Africa.

AL KHAZNA // The Abu Dhabi Group, an investment company led by members of the royal family, will form a partnership with India's Essar to expand its African telecommunications business. Through its Warid Telecom subsidiary, the Abu Dhabi Group owns mobile networks in Pakistan, Bangladesh, Congo, Uganda and Cote d'Ivoire. Essar's telecom unit built one of India's largest mobile networks, which it now owns in a joint-venture with Vodafone, based in the UK. The two companies yesterday entered exclusive negotiations that will enable Essar, one of India's largest diversified industrial conglomerates, to invest in the Abu Dhabi Group's African businesses. Both companies have built, launched and operated telecom networks in emerging markets and the partnership is intended to capitalise on shared opportunities, said Prashant Ruia, the group chief executive of Essar. "We have significant complementary strengths," he said at a signing in a royal residence in Al Khazna, half way between Abu Dhabi and Al Ain. "We've got a reasonable amount of experience in the telecom space, and we're looking at a complementary partnership that will improve the services we provide to the African market." Essar already operates a mobile network in Kenya, but gave no comment on the possibility for integration between it and networks owned by the Abu Dhabi Group, particularly in neighbouring Uganda. Essar's investment will be in the form of equity stakes in each network, with the new cash used to fund growth. A preliminary agreement between the Abu Dhabi Group, also known as Dhabi Group, and Essar was signed yesterday in Al Khazna in a meeting between Mr Ruia and Sheikh Nahyan bin Mubarak, the chairman of the Abu Dhabi Group, who is also Minister of Higher Education and Scientific Research. Essar has also built a healthy business in India as an independent builder of telecommunications network infrastructure. As mobile networks look to cut costs and streamline operations, demand for such service providers is increasing. Mr Ruia said his company's partnership with the Abu Dhabi Group would remain focused on operating networks for the time being, particularly in the markets where the company was already operational. "We have to go step-by-step and see how we can take this forward," he said. "Warid has already made significant investments, and we plan on increasing them." The size of Essar's investments and the ways in which the two companies will work together was not disclosed at yesterday's signing. Both parties said specifics of the agreement, including any possible managerial or technical co-operation, would be announced in the coming months. The Abu Dhabi Group's investment portfolio, which it says is worth more than US$10 billion (Dh36.73bn), includes a number of banking and construction businesses, predominantly in Asia and Africa. Aside from Warid Telecom, its only other technology investment has been in Arvato Middle East Sales. Last year Arvato worked with the Abu Dhabi Media Company, the publisher of The National, to launch Getmo, an online entertainment downloads store targeting the Middle East. tgara@thenational.ae

The two companies yesterday entered exclusive negotiations that will enable Essar, one of India's largest diversified industrial conglomerates, to invest growth capital into the Dhabi Group's African businesses. Both businesses have successfully built, launched and operated telecom networks in emerging markets, and the partnership is intended to capitalise on shared opportunities, said Prashant Ruia, the group chief executive of Essar.

"We have significant complimentary strengths," he said. "We've got a reasonable amount of experience in the telecom space, and we're looking at a complimentary partnership that will improve the services we provide to the African market. " A preliminary agreement between the Dhabi Group and Essar was signed yesterday in Abu Dhabi, in a meeting between Mr Ruia and His Highness Sheikh Nahayan Al-Nahayan, the chairman of the Dhabi Group.

Essar has built a healthy business in India as an independent builder of telecommunications network infrastructure. As mobile networks look to cut costs and streamline operations, demand for such service providers is increasing. Mr Ruia said his company's partnership with the Dhabi Group would remain focussed on operating networks for the time being, particularly in the markets where the company is already operational.

"We have to go step-by-step and see how we can take this forward. Warid has already made significant investments, and we plan on increasing them." tgara@thenational.ae