Tanzania Telecommunications Company Limited

Early history

TTCL traces its roots to the East African telecommunications provider. In 1933, the former East African Post and Telegraph Company covered Postal, Telegraph and Telephone services in the three East African nations of Tanganyika, Kenya and Uganda. In 1951 the British government replaced the East African Post and Telegraph Company and enacted the The East African Posts and Telecommunication Act in 1951 to charter the East African Posts and Telecommunications Administration.

In 1967, post independence of the three nations, the East African Community (EAC) was founded and replaced the East African Common Service Organization. In the aftermath, the East African Post and Telecommunications Corporation (EAP&TC) was established and replaced the East African Posts and Telecommunications Administration. However, ten years later, the breaking up of EAC in 1977 forced EAC member countries to re-establish their own national Postal, Telegraph and Telephone businesses. Therefore, in 1978 in Tanzania a parastatal was established under the name Tanzania Posts and Telecommunications Corporation (TPTC).

In 1993 when the government of Tanzania heavily restructured parastatals, the Telecommunication sector was liberalised. This saw the splitting up of the TPTC; the TPTC split into three separate entities, namely the Tanzania Posts Corporation, the Tanzania Telecommunications Company Limited (TTCL), and the Tanzania Communication Commission (TCC).

Partial privatisation

With increased domestic competition and poor management the government decided to privatise the company. The partial privatisation of TTCL began on 23 February 2001, with Celtel International (previously known as MSI Cellular) headquartered in Amsterdam, Netherlands, together with the German firm Detecon, obtained 35% shares from the Government of Tanzania. The consortium took over Board and Management control of TTCL, and 23 February 2001 onward, had a veto over major Board of directors decisions, right to appoint the senior management, to set the annual business plan and to control all capital expenditure decisions. In August 2005, TTCL pulled out from joint management and the Government of Tanzania and Celtel International signed an agreement whereby the shareholders agreed to the restructuring of the two companies and thereafter the TTCL and the Celtel became legally, financially and operationally totally separate companies.

Sasktel

The government faced similar issues with the company due to lack of capital and in 2 years in February 2007 the Government of Tanzania awarded a Canadian firm SaskTel a three-year contract to manage TTCL. The contract required the new management team to improve the financial position of TTCL and grow its customer and revenue sources. SaskTel International started to manage TTCL from 1 July 2007. However, SaskTel was not able to turn the fortunes of the company around and in May 2009, SaskTel submitted a 45-day notice on 12 July 2009, outlining its intention to pull out of the contract.

Transfer of shares

On September 2007 Celtel's Parent Company MTC Group was acquired by Zain International BV of Kuwait. Along with the celtel brand, Zain also acquired the 35% share in TTCL. From the 2005 agreement Celtel and TTCL were considered separate legal entities and therefore, Zain had no direct control over the companies operations. Similarly on 8 June 2010, Bharti Airtel struck a deal to purchase of mobile operations in 15 African countries from Zain and inherited the stake.

Nationalization

In February 2016, Bharti Airtel owner of 35 percent stake in the state telecom company agreed to sell its shares back to the government for 14bn/-. The dispute between the company and the government lasted for three years as the company demanded more money in compensation. However, the sale was concluded on 23 June 2016 and the company returned to being entirely state owned.

Ownership

Currently the company is wholly owned by the Government. In 2001 the government of Tanzania sold 35% stake in the company and in 2016 to protect the firm, repurchased the stock to regain 100 percent ownership. The last partners of the company were Bharti Airtel of India.

Business trends

As of March 2016 TTCL has the smallest subscriber base than the top six mobile phone operators in the country. TTCL maintains a total subscriber base of 305,000 of which 45 percent have fixed phone lines. In the fixed line market, TTCL almost has a monopoly and handles over 99 percent of the subscribers.

Headquarters

The company has its headquarters and customer care allocated in Extelecom's Building in Dar Es Salaam, Tanzania. TTCL also manages and operates offices and an engineering department in all regions and major towns in the country.