Etisalat Nigeria to raise $500m in debt from local banks

Etisalat Nigeria, one of the Nigeria's telecoms operator, plans to raise $500m in debt from local banks to expand its network this year, its Commercial Officer, Mr. Wael Ammar, said on Thursday.

Speaking at the Africa Investment Summit, Ammar said that the investments would enable the mobile phone carrier grow the market share of Etisalat Nigeria, which is 40 per cent owned by its parent company, to 17 per cent this year.

The company aims to add four million subscribers to its existing 15 million this year, Reuters quoted Ammar as saying.

It currently has a mobile market share of 15 per cent, behind MTN's 43 per cent and Globacom's 22 per cent. Airtel, a subsidiary of India's Bharti Airtel, has a 20 per cent share.

Ammar also said he expected average revenues for voice traffic across the industry to continue to decline to around $5 per user over the next three to five years, from around $6-$7 per user currently. The ARPU was $10 per user in 2008, he said.

'We are investing $500m this year to expand our network and services to Nigerian consumers,' Ammar said, adding that Etisalat aimed to increase its existing 3,000 cell sites by an undisclosed number.

Ammar said Etisalat entered Nigeria's fast growing market as a start-up operation with a $2bn investment seven years ago, facing more established rivals like South Africa's MTN and Globacom, owned by billionaire tycoon, Chief Mike Adenuga.

He said Etisalat would be able to grow its subscriber base without having to poach large numbers of customers from rivals because some 40 per cent of Nigerians - tens of millions of people - still did not own a phone.

'We see the second wave of growth coming from the youth segment. It is a huge segment that will turn into future consumers and the growth will happen across multiple years,' he said.

'What we see for the future is that the growth will be on data and this will be the balancing act for ARPU stabilisation,' Ammar said.