Harith General Partners, a pan-African infrastructure investment firm, has expanded its telecoms portfolio through a $24.1 million (about K 18 billion) investment in Open Connect Limited (OCL), the country’s only redundant fibre network provider.
This means that Harith now becomes OCL’s biggest shareholder at 60 percent, which is held through its Pan-African Infrastructure Development Fund (Paidf) with other shareholders—Press Corporation Limited (PCL), Malawi Government, Old Mutual Limited, Nico Holdings Plc and Investments Alliance Limited.
In a statement, PCL group chief executive officer (CEO) George Partridge said: “As a leading investor in Malawi, we are proud to partner with an investor of Harith’s stature in the next development phase of OCL.
“The introduction of Harith presents an exciting opportunity for OCL to grow from its already market leading position into an even more powerful force in the telecoms space in east Africa.”
On his part, Harith CEO Tshepo Mahloele said as an investor in the telecoms sector on the continent, it believes in partnering with a proven operator in Malawi and thus expanding their portfolio into East Africa
He said: “This is a logical step in our company’s investment strategy. With our investments in MainOne in Nigeria and Dark Fibre Africa in South Africa, we have proved that access to fast and affordable communication is a massive growth enabler for African economies, and we believe OCL will continue to grow its market leading position in this part of our continent.”
OCL currently has the largest fibre optic coverage in Malawi and provides carrier of carrier, redundant light and dark fibre services to mobile operators, Internet service providers (ISPs) and terrestrial television providers.
As the only fully redundant fibre network provider in the Malawian domestic market, with key international fibre links to Mozambique and Tanzania, OCL additionally has a direct connection to Seacom’s Indian Ocean Submarine Cable and to Eassy via Mozambique de Telecommunication (TDM).
Harith made its OCL investment at a time it was intending to upgrade its offering and thus continue to provide connectivity to its customers.
In a statement, Harith said major revamp the network will undergo will ensure OCL maintains its competitive advantage.
With a population of over 18 million people, the country’s economy is agriculturre-based, but the service sector—of which telecommunications is a key sub-sector—has seen significant growth over the past couple of years, and now contributes the largest portion to the economy, which is expected to grow by 4.1 percent is year.
The growth potential of the services sector is expected to remain strong as ISPs seek to grow their customer bases and mobile phone operators have huge potential to increase sales and Internet subscriptions and expand new services such as mobile banking.
In the half-year ended June 30 2018, PCL reported a 227 percent increase in profit after-tax to K23 billion from K7 billion during the same period last year which was boosted by the “deemed disposal of a 60 percent stake in OCL valued at K8.48 billion following issuing of shares to Harith.