Botswana Power Corporation has joined hands with an international telecommunications company to establish a new telecoms network provider. Liquid Telecom group, which has operations in selected African countries, is the firm that BPC has partnered with to form Liquid Telecom Botswana.
The company is expected to compete with players such as Botswana Fibre Network (BOFINET) in the highly competitive telecoms network industry. The historic deal was penned by outgoing Chief Executive, Jacob Raleru and his Liquid Telecom counterpart, Nic Rudnick in Gaborone.
According to a press statement, the joint venture will operate under the name Liquid Telecom Botswana. The partnership will enable the state-owned company to make more effective use of existing assets, while allowing its Liquid Telecom to better service the needs of wholesale enterprises.
BPC, the power utility owns and operates optical fibre cable network that is embedded in some of its voltage transmission lines. The new BPC partner was selected after a competitive bidding exercise, said the company. The Mauritius-based company will be the majority shareholder. It will run the day to day activities of the company, Liquid Telecom Botswana.
“The use of BPC’s optic fibre cable network will be granted to Liquid Telecom Botswana under the Indefeasible Right of Use Agreement (IRUA). Rather than taking any rental payments, the capital value of the IRUA will be used to purchase BPC’s equity stake, which is 42, 5 percent,” said BPC.
The power utility is excited about the deal, indicating that it will diversify its revenue base away from electricity sales to both retail and institutional customers. The state-owned power utility has been making perennial losses due to rising operational costs and the non-completion of Morupule B power station.