Cash boost for Virgin Mobile SA
The Gulf Investment Corporation (GIC) is to invest $50 million in Dubai based Virgin Mobile Middle East & Africa (VMMEA), as the group looks to roll out its brand across the region.
VMMEA is a mobile virtual network operator (MVNO) with operations in South Africa, Oman, Jordan, and Saudi Arabia.
GIC is a financial institution equally and wholly owned by the six Gulf Cooperation Council (GCC) countries.
Following the conclusion of the transaction, GIC and the Virgin Group will be the two biggest single shareholders in VMMEA, alongside shareholders including, ePlanet Capital, Dolphin International, NTEC and Millennium Private Equity.
Sir Richard Branson, Founder of Virgin, said: “Virgin Mobile is the leading MVNO operator in the Middle East and Africa with operations in Oman, Jordan, Saudi Arabia and South Africa.
“We intend to create a large regional mobile telecom player reaching more than 10 million customers. The investment by GIC is an important show of support by an important institutional investor for our ambitious plans.”
Mikkel Vinter, CEO and Founder of VMMEA, said: “The Management of VMMEA look forward to working closely with GIC in rolling out the Virgin Mobile brand across the Middle East & Africa.”
In December, Vinter told BusinessTech that Virgin regarded South Africa as a “big market, penetration is still going up. We see that the Virgin brand has its place in South Africa”.
Virgin Mobile SA is reliant on Cell C’s network, and says its subscriber base is approaching 400,000. Vinter said that group did not require many millions of subscribers to turn it into a profitable business.
In June last year, Virgin Group merged with the Friendi Group, the Middle East-focused mobile virtual network operator, to create Virgin Mobile Middle East and Africa, based in Dubai.
And then in July, it announced that it would reduce its store footprint to just eight locations as part of a plan to improve its customer experience. The process was expected to conclude during the first half of 2013.
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