The Ministry of Communications announces the conclusion by the Government of Ghana (GoG) of a sale and purchase agreement with Celtel International, a subsidiary of Kuwaiti company Zain (formerly named MTC) in respect of 75% of the shares of Western Telesystems (Ghana) Limited, (Westel). The GoG through the Ghana National Petroleum Corporation holds the remaining 25%.

Following extensive negotiations, a price offer of $120 million has been agreed upon for 75% shareholding reducing to 70% within three years when Celtel will release 5% of its shares in addition to those to be released by GoG to be floated on the Ghana Stock Exchange (GSE) to benefit the Ghanaian public.

The offer price of $120 million includes an additional consideration of $15 million outright payment to cover the penalty fee of $25 million due to the National Communications Authority (NCA), an amount which would have been paid over an eleven-year period of the licence’s lifespan.

It is recalled that the successful conclusion of a settlement agreement between GoG’s and Western Wireless International (WWI) saw the transfer of the 66.67% shares of WWI to GoG. Consequently in March 2006, the GoG charged the Ministry of Communications to facilitate the divestiture of Westel in an open and transparent manner.

An inter-ministerial committee was duly constituted with representation from the Ministries of Communications, of Finance and Economic Planning, of Energy, and Attorney General’s Department, the President’s Office, in addition to representatives of Ghana National Petroleum Company (GNPC) and Westel to select a Transactions Advisor. Messrs NTHC/Databank was accordingly selected as the Transactions Advisor to undertake the privatisation of Westel through a competitive process.

By the close of the deadline for the submission of bids for Westel and after consideration of the technical evaluation of the capabilities of the companies, the Transactions Advisor presented the following potential investors in order of ranking: • Celtel • Kinz Telecom • Vodacom • African Soft Ltd • National Telecom Cards Company • Afritel Communications.

In accordance with the terms of reference of the request for proposals, the Transactions Advisor recommended the top four bidders for negotiations with Government. However, Vodacom withdrew its candidature before official negotiations could begin.

Kinz Telecom of United Arab Emirates Encouraged by the outcome of the initial discussions, Government invited Kinz Telecom on 11 April 2007, as it had offered the superior initial price, to seek firm commitments on technology, details of roll-out implementation, as well as possibility of price enhancement by the company.

For consideration of additional spectrum requests by Kinz for Third Generation Network (3G) licence and Wimax frequencies, the company accepted to pay a total of US$250 million for 66.67% shares of Westel, after which a Memorandum of Understanding was signed for payment to be executed within 45 days before the conclusion of a Sales and Purchase Agreement (SPA).

After the expiry of the stipulated time and further extensions granted for the payment, Kinz Telecom was not able to fulfil its undertaking and consequently, the exclusivity granted to it was withdrawn, whereupon Government invited Celtel, as the next successful bidder, for negotiations over its bid.

Celtel International BV On 10 July 2007 Celtel International, a subsidiary of Kuwaiti company Zain (formerly named MTC) entered negotiations with GoG and for the purposes of this transaction turned down the offer of additional licences for Wimax and Third Generation Network (3G) services at this time. The ensuing negotiations, therefore, resulted in an agreement on the final offer price of $120 million. It is to be noted that this amount is considerably less than the Kinz price quoted above, but principally, this is due to the limited frequencies being offered to Celtel.

Celtel will be investing millions of dollars in a state-of-the art telecommunications network and associated services to offer its unparalleled experience as a pan-African operator, bringing telecommunications services to more than 24 million customers in 14 countries across the continent. Celtel prides itself on offering attractive career opportunities in its countries of operation, not only with the company directly, but also via its network of distributors, suppliers and advisors. Westel’s current management and staff, who have worked under challenging circumstances to date, will play an important role in taking the company forward.

Celtel also looks forward to promoting Ghana as a gateway to West Africa through its One Network, the world’s first borderless network. This offers Celtel’s customers the opportunity to move freely across geographical borders using the same services they would access in their home country, and to make calls without roaming surcharges and without having to pay to receive incoming calls and messages. The service also permits customers to buy and top up with local airtime when they visit other countries in which One Network is operational. Celtel’s One Network service is currently operational for 160 million people across six nations in East and Central Africa.

The Ministry of Communications acknowledges the contributions of all stakeholders in the development of the communications sector and cherishes the support enjoyed to ensure that access to communication facilities would be enhanced.

It is our conviction that the entry of Celtel on the Ghanaian telecom market at this stage will further promote the needed competition in the telecom sector to ensure quality service delivery to the people of Ghana.

In this regard the Government of Ghana wishes to extend a warm welcome to Celtel as new market entrants into the telecom field.

Dr. Benjamin Aggrey Ntim Hon. Minister of Communications