Mukesh Ambani, chairman and managing director of Reliance Industries, is poised to expand into Africa with a new telecom venture, aiming to capture mobile broadband customers in this rapidly growing market.
According to a report by Bloomberg, Radisys Corp., a subsidiary of Reliance Industries Ltd., will supply essential network infrastructure, applications, and smartphones for Ghana-based Next-Gen InfraCo.
Harkirit Singh, the executive director of NGIC, detailed these plans ahead of NGIC’s launch announcement on Monday in Mumbai, India’s financial hub.
NGIC, set to commence operations by the end of this year, will offer 5G broadband services to mobile operators and internet service providers in Ghana.
The company “is based on a premise of building affordable digital services in emerging markets,” Singh told Bloomberg News.
Other strategic partners in NGIC include Nokia Oyj, Indian outsourcing company Tech Mahindra Ltd., and Microsoft Corp., which has intensified its focus on the telecom industry following its acquisition of two cloud networking firms in 2020.
Ghana, a West African nation with a population of just over 33 million, has three main operators: MTN Ghana, Vodafone Ghana, and the state-run AirtelTigo. Singh stated that NGIC’s strategic partners, technological expertise, and exclusive possession of Ghana’s only 5G licence will enable it to build broadband services at scale, a significant expense for individual mobile carriers.
The Bloomberg report added that Singh stated that two African telecom firms, Ascend Digital Solutions Ltd. and K-NET, collectively hold a 55% stake in the new company. The Ghanaian government will own just under 10% of NGIC, while local mobile operators and private investors will hold the remaining shares. Singh also serves as the chief executive of Ascend.
NGIC holds the exclusive right to provide 5G services in Ghana for the next decade, with its licence valid for 15 years. According to Singh, the company’s capital expenditure over the next three years is set at $145 million.
The company aims to replicate the success of Ambani’s Jio Infocomm Ltd. in India. Jio revolutionised the Indian telecom industry by introducing low-cost data and free voice calling when it launched in late 2016, leading to the closure of some competitors and the consolidation of others. It is widely acknowledged for making mobile data affordable for hundreds of millions of Indians. Currently, Jio stands as India’s largest mobile operator with 470 million users.
The collaboration between Reliance and NGIC is a diplomatic victory for India, as the country aims to offset China’s growing influence in Africa through initiatives like digital inclusion.
None of the strategic partners, including Reliance, hold any equity in NGIC. However, Singh explained that the company plans to offer them the option to receive a portion of their payments as equity in the future.
“First we have to be successful to show the value that we create before they come in,” Singh said. “That’s the discussion we’re having with them.”
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