Belgacom ICS (BICS), a subsidiary of Belgian fixed line incumbent Belgacom, has announced an agreement with South Africa’s MTN to combine international carrier services. Under the terms of the deal MTN will take an equity stake in BICS in return for merging the assets of its own international wholesale subsidiary MTN ICS. Additionally, BICS will operate as MTN’s official international gateway for carrier services globally. The companies both expect the tie-up to allow them to ‘improve efficiencies and product offerings resulting from greater economies of scale’. In addition to the anticipated efficiencies, the transaction is expected to positively impact the future growth of the larger combined entity to become the leading international wholesale operator in Africa. Daniel Kurgan, CEO of BICS, said of the deal: ‘Thanks to this cooperation, BICS will reinforce its leadership in international wholesale telecommunications, both for voice services and for international connectivity services to mobile operators. Becoming the carrier partner of Africa’s biggest mobile group will significantly strengthen our footprint and make BICS the number one international carrier in Africa.’
The transaction is expected to be completed by the end of 2009 subject to necessary approvals from the relevant authorities in both Belgium and South Africa. On completion Belgacom will own 57.6% of BICS, Swisscom 22.4% and MTN 20.0% with the right to appoint two directors to the board.