The Nigerian operation of United Arab Emirates phone operator, Etisalat, plans to raise $500 million in debt from local banks to expand its network this year, its commercial officer told Reuters on Thursday.
Wael Ammar told the Reuters Africa Investment Summit that the investments will enable the mobile phone carrier grow the market share of Etisalat Nigeria, which is 40 percent owned by its parent company, to 17 percent this year.
It aimed to add four million subscribers to its existing 15 million this year, he said. The company currently has a mobile market share of 15 percent, behind MTN’s 43 percent and Globacom’s 22 percent. Airtel, a subsidiary of India’s Bharti Airtel, has a 20 percent 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 3-5 years, from around $6-7 per user currently. ARPU was $10 per user in 2008, he said.
“We are investing $500 million this year to expand our network and services to Nigerian consumers”, Ammar said, adding that Etisalat aims 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 $2 billion investment 7 years ago, facing more established rivals like South Africa’s MTN and Globacom, owned by billionaire tycoon Mike Adenuga.
Ammar said Etisalat would be able to grow its subscriber base without having to poach large numbers of customers from rivals because some 40 percent of Nigerians — tens of millions of people — still did not own a phone.