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AP Photo/Ben Curtis
There is growing demand for data and bandwidth across the continent.
SMILING TO THE BANK

Smile, the pan-African wireless ISP, has raised $365 million to expand its network

Yomi Kazeem
By Yomi Kazeem

Three years after launching Africa’s first 4G LTE services in Tanzania, Uganda and Nigeria, Smile Telecoms has raised $365 million.

The funding, one of the largest capital raises by any operator in Africa’s telecommunications space, is includes $50 million of equity raised from South Africa’s Public Investment Corporation and $315 million in debt financing by a group of financial institutions in Nigeria and South Africa led by African Export-Import Bank.

The landmark funding will be directed towards expanding Smile’s 4G LTE mobile broadband networks and services said Irene Charnley, Smile’s Chief Executive Officer.

One of the company’s goals is to develop national coverage in countries of operation as well as help meet its early 2016 launch date for its broadband network in the Democratic Republic of Congo.

Smile provides its markets in Tanzania, Uganda and Nigeria with broadband internet access via wireless LTE subscription-based modems to help get round the lack of fixed line broadband infrastructure in most countries on the continent.

With subscription packages available at about $27 for five gigabytes and $42 for ten gigabytes of data monthly, Smile’s pricing allows it target the middle class, upwardly mobile demography who form a large part of the internet users statistics and also have increased disposable income.

Smile’s planned expansion could be critical in Africa, the continent with the world’s lowest internet penetration. In recent times, there has been news of rapid internet capacity growth in Africa compared to other regions but regardless of the rapid growth, speed remains a sticking point for internet users on the continent.

Having raised $600 million since inception in 2007, Smile now has a broad range of shareholders including Saudi Arabia’s Al Nahla Group, its largest shareholder. With its $50 million buy-in, South Africa’s Public Investment Corporation is Smile’s newest shareholder. Other key shareholders are Renven Investment Holdings which has Nigerian investors such as Obijackson Group as the majority in the investment vehicle, Telecom Investments- a Saudi Arabian investment firm, Capitalworks – a South African alternative management company and Verene which represents social entrepreneurs from South Africa as well senior Smile management.