Orange has set up a separate holding company for its operations in Africa and the Middle East, underlining its commitment to the region.
The operator is increasing its focus on MEA, and currently operates in 19 countries across the region. It is aiming to increase its revenue from these operations by 5% each year for the next 3 years. It also believes that its operating profit will outstrip sales growth.
After lengthy speculation, the operator group will create a holding company under one legal framework for all units in these regions. Deputy CEO and CFO Ramon Fernandez said: “We do a lot in both regions, so we wanted to create a clearer means of communication.”
“Now you can access our revenue and EBITDA performance specific to this part of the world. We could use it to work on strategic partners and develop our activities here, which we believe will be popular. When you look around, there is not a lot of scope for international companies to invest in Africa and this could be a way in”, he added.
Fernandez denied suggestions that a separate holding company would make it easier for Orange to pull out of the region, noting that the group was seeking investors in Egypt as well as looking to increase its stake in Moroccan operator Meditel. He did however note “we could look at a listing at some point. We are creating conditions for opportunities as they arise”.
The Africa and Middle East regions are currently the most profitable for Orange, generating an average revenue increase of 33%, which is 2% above the increase Orange saw in Europe.
Fernandez noted that Orange was not looking to other markets, saying: “We are not trying to be an operator in Asia, Latin America or North America. We are an operator in Europe, Africa and the Middle East and that’s where we want to be.”
He noted that Orange was considering acquisitions in Africa, noting that Airtel’s assets could be available if the Indian operator makes its heavily rumoured exit. “When you look at our track record, coupled with our existing presence, we are in a position to add assets if we find them at the right price. We will focus to look at potential opportunities and we have an open mind over the potential that exists”, said Fernandez.