BPC presently owns and operates a fibre-optic cable network embedded on some of its high voltage transmission lines, but spare unused capacity prompted BPC to explore ways to commercialise the network for the first time. The new JV will see BPC lease excess optical fibres from its network to Liquid Telecom.
It will enable BPC to make more effective use of its existing assets, providing a new infrastructure-based network operator to stimulate competition in the Botswana telecommunications market. Liquid Telecom will be able to better serve the network needs of its wholesale and enterprise customers in the region.
BPC board of directors approved the commercialisation of its network back in March 2016, and, following a period of competitive bidding, Liquid Telecom was selected as the preferred partner.
The use of BPC’s infrastructure will be granted to Liquid Telecom Botswana under an 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 42.5% equity stake. Liquid Telecom will be the majority stakeholder in Liquid Telecom Botswana.
Earlier this year, Liquid Telecom agreed to purchase Neotel, South Africa’s first converged communications network operator, for ZAR 6.55 billion, creating the first pan-Africa fibre player.
