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Essar gets Sh7.5 billion to expand network in Kenya

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Kenya's fourth mobile services provider, Essar Telecom Kenya says it has received Sh7.5 billion from Pan African Infrastructure Development Fund (PAIDF) to expand its East African operations.

The latest entrant into the mobile telephony market says it hopes to use the funds on capital expenditure in the course of the year. 'We shall use the funding on all CAPEX related activities, this covers infrastructure, network rollout, and IT, in readiness for a country-wide rollout in September,' said Srinivasa Iyengar, CEO. Essar has 400,000 subscribers and is present in Nairobi and Mombasa.

The firm hopes to beat CCK set guidelines on rollout by launching country-wide services in under a year. Under the terms of its licence, Essar has a set target of three million subscribers in the first three years.

It hopes to achieve this goal by leveraging on a unique pricing structure as well as introducing a new concept on infrastructure roll-out, which includes infrastructure sharing with its competitors, Safaricom, Zain and Telkom Kenya.

The financial boost comes at a time when mobile firms around the world are recovering from the effects of the global financial crisis, which dampened prospects of gaining financing for several players in the market.

Iyengar also said his company was in the process of initiating trials of its mobile money transfer service following approval by the Central Bank of Kenya. 'We hope to launch the service in September to coincide with our achievement of complete country-wide coverage.'

The service will be offered in partnership with [Internet payment solution provider] Obopay, said Iyengar.

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