The government has revealed that it has secured over 10,500 jobs in its decision to acquire 100 percent shares in AirtelTigo earlier this year. According to Finance Minister, Ken Ofori-Atta, the government’s decision to acquire the shares was to protect the company from total collapse and to safeguard the livelihoods of the numerous Ghanaians who depend on the company for survival.
“This decision was taken to prevent the total collapse of the Company and ensure preservation of 500 direct and over 10,000 indirect jobs; and preserve small-scale Ghanaian companies that depend on the company for their wellbeing. The government intends to preserve this national asset, facilitate its restructuring for growth and eventual partnership, and promote a dynamic and competitive telecoms market”.Ken Ofori-Atta
According to the Minster, Government on 31st March 2021 signed a Sale and Purchase Agreement (SPA) with Bharti Airtel and Millicom which operates AirtelTigo to acquire 100 percent shares of the Company for the nominal consideration of US$1.
Concerns raised by employees
Meanwhile, the decision by the government to acquire the shares raised a lot of concerns with many Ghanaians, especially workers of AirtelTigo, expressing worry about possible loss of jobs. At that time, the situation even looked scarier due to the difficulties workers face as a result of the economic fallouts of the pandemic. To many Ghanaians, this was surely going to compound the already rising unemployment rates in the country.
However, it can be recalled that Communications and Digitization Minister, Ursula Owusu-Ekuful gave an assurance that jobs at the telecommunications firm would not be affected after the takeover.
AirtelTigo is a joint venture between Bharti Airtel and Millicom International Cellular, operators of tiGO in Ghana. The two merged in 2017, becoming the second-largest telecom operator in Ghana at the time. Additionally, Bharti Airtel holds a non-controlling 49.95 percent stake in AirtelTigo.
Genesis of the takeover
In October 2020, the government of Ghana announced its intention to purchase majority of shares along with assets, liabilities and customers of AirtelTigo Ghana from its parent company Bharti Airtel and Tigo.
The government earlier indicated that the decision to purchase 100 percent shares of AirtelTigo is primarily intended to save jobs and protect stakeholders interest of some 5.1 million customers.
However, one of the issues that has undermined the country’s development over the years has been the inability of successive governments to nurture and sustain state-owned companies.
After independence, the country relied on state-owned companies and industries to create employment for the youth and produce most of the things the country needs locally.
However, following the formation of the National Divestiture Implementation Committee, most of the country’s strategic assets were sold to private individuals and foreign investors. This was mainly due to poor governance and management practices, pilfering, lack of investment and re-injection of capital in such national companies, liberalisation of the economy, among others.
Unsurprisingly, until the takeover, the state did not have any major footprint in the telecommunication sector after Ghana Telecom, now Vodafone, and Airtel, then Westel, were sold.