yuMobile staff seek benefits before Safaricom, Airtel buyout

yuMobile staff seek benefits before Safaricom, Airtel buyout

Employees of Kenyan operator yuMobile, which is set to be acquired by rivals Safaricom and Airtel, are demanding their termination benefits are paid before any deal is completed.

The 233 employees told a press conference yesterday they had rejected a transfer to either Safaricom or Airtel, and are demanding KSh1.2 billion (US$13.9 million) in severance pay and annual bonuses.

HumanIPO reported earlier this week Safaricom and Airtel look set to complete the purchase of yuMobile from Essar Telkom for KSh8 billion (US$93 million), with Safaricom taking over yuMobile’s existing infrastructure and 130 employees, while Airtel will acquire the company’s mobile prefix, effectively adding three million subscribers to its network.

yuMobile said it hopes to complete the deal within the next three months, with the buyout now needing approval from the Communications Commission of Kenya (CCK) and the Competition Authority of Kenya.

The yuMobile employees, however, have asked the CCK and the Competition Authority to delay approving the deal until their case is completed.

HumanIPO reported last week a group of Essar employees had gone to court seeking an order to prevent yuMobile managing director Madhur Taneja from travelling to stop him from fleeing the country before he finalises an alleged retrenchment plan with them.

They are also seeking orders prohibiting the transfer of assets or business until a proper investigation has been completed, and want yuMobile to disclose the terms of the restructuring agreements.

Essar said earlier this year it would be selling a stake in yuMobile in order to raise funds for widening its footprint and expanding its 3G capabilities.

yuMobile has been experiencing losses of up to KSh25 billion (US$290 million), and held a 10 per cent market share before the buyout, trailing behind prospective new owners Safaricom and Airtel, as well as Orange Kenya.

Image courtesy of Shutterstock.

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