The MSA was entered with the objective of transforming Ghana Telecom into a modern telecom company. Within a period of five years GT should be put a position to provide sufficient number of lines and/or cellular connection of international standard to the Ghanaian public, to public entities as well as business enterprises.
Telenor is Norway’s leading telecom company with extensive operations in and outside Norway, including the Nordic Countries, Eastern Europe and South East Asia. Telenor is one of the major players in global satellite communication.
Government of Ghana selected Telenor Management Partner (TMP), a daughter company of Telenor, as a partner in developing Ghana Telecom according to the above objective. As a first step TMP was requested to develop a business plan for Ghana Telecom in which it should be demonstrated how TMP would meet the objectives of the Government.
MANAGEMENT TO BE PROVIDED BY TMP
In consultation with the Government of Ghana TMP shall provide qualified persons to hold the positions of Managing Director, Chief Financial Officer and Chief Technical Officer.
Government of Ghana shall nominate deputies to these positions who shall be trained to take over the responsibility on expiry of the MSA. Qualified Ghanaians will hold all other managerial positions.
OTHER SERVICES TO BE PROCURED FROM TMP
Other services to be provided by TMP shall include but not limited to the following:
v Implementation of the business plan including the rollout plan
v Advisory services to the Board of GT
v Qualified expert staff, who will support the GT staff for a shorter or longer period.
The expert staff will cover all relevant areas in which GT is in need of training and know how transfer.
Project management expertise and systems
The Board of Directors of Ghana Telecom will upon the recommendation of the GT management procure such services. The seconded staff from TMP will stay in Ghana for the period decided by the board.
The payment for the services will be invoiced by TMP to Ghana Telecom. For services such as funding assistance, advisory services to the Board of Directors, systems and know how transfer Ghana Telecom will pay a fee of 4% of the profit before interest and tax. This means that 96% of the profits are available for reinvestments in Ghana Telecom or to the disposal of the shareholders. The minimum fee should, however, be $150.000 per month.
For services of expert personnel TMP will invoice in accordance with the procurement of such service by the Board of Directors of Ghana Telecom. Pursuant the MSA Ghana Telecom will provide accommodation and transport of a standard similar to what is common for other expatriate staff working in Ghana.
OBJECTIVES OF THE BUSINESS PLAN
The business plan sets out targets on which the rollout plans will be based. These targets include:
v 400.000 new fixed lines by the end of 2005
v Adequate and stable cellular coverage in all regional and district capitals
v Internet connection to all Senior Secondary Schools and Teacher Training Institutes within 3 years
v High speed data transmission capacity servicing both public and private customers demanding such services
Ghana Telecom is determined to meet these targets. As a commercial enterprise GT is demand driven. If demand requires an even higher number of lines or cellular coverage it is the business of GT to meet such demand. If on the other hand it should turn out that the market had been overestimated, plans would have to be adjusted accordingly.
To meet the objectives of the business plan a capital expenditure of close to $500 million is required. The investments will be funded by vendor financing, financing from financial institutions, new equity and by the operating cash flow generated by Ghana Telecom.
SUCCESS FEE OR DEFAULT PAYMENT
If under the TMP management the targets in the business plan related to profit, number of lines and number of subscribers is exceeded by 10% or more, a success fee of 4% of the net income attributable to the actual performance better than targets set and shall be determined at the Board of GT.
The default payment shall be 4% of the net income, which could have been earned, if the performance had been equal to the targets set and shall be determined by the Board of GT.
NEW MANAGEMENT
The Board of Directors of Ghana Telecom has appointed Mr. Oystein Bjorge of TMP as the new Chief Executive Officer as of Monday 27 January 2003. He will immediately start the work to implement the business plan. On short term this includes but is not limited to:
v Introduction of a new organisational structure as described in the business plan and to be finally approved by the Board
v Appointment of managers (with the exception of those to be appointed by the Government of Ghana) to fill positions in the new structure. Appointments will be based on the following criteria: Qualifications, integrity, attitude to work and working capacity
v Project planning and design including improvements and extensions
v Introduction of TMP personnel to work alongside the GT management and staff
The MSA was entered with the objective of transforming Ghana Telecom into a modern telecom company. Within a period of five years GT should be put a position to provide sufficient number of lines and/or cellular connection of international standard to the Ghanaian public, to public entities as well as business enterprises.
Telenor is Norway’s leading telecom company with extensive operations in and outside Norway, including the Nordic Countries, Eastern Europe and South East Asia. Telenor is one of the major players in global satellite communication.
Government of Ghana selected Telenor Management Partner (TMP), a daughter company of Telenor, as a partner in developing Ghana Telecom according to the above objective. As a first step TMP was requested to develop a business plan for Ghana Telecom in which it should be demonstrated how TMP would meet the objectives of the Government.
MANAGEMENT TO BE PROVIDED BY TMP
In consultation with the Government of Ghana TMP shall provide qualified persons to hold the positions of Managing Director, Chief Financial Officer and Chief Technical Officer.
Government of Ghana shall nominate deputies to these positions who shall be trained to take over the responsibility on expiry of the MSA. Qualified Ghanaians will hold all other managerial positions.
OTHER SERVICES TO BE PROCURED FROM TMP
Other services to be provided by TMP shall include but not limited to the following:
v Implementation of the business plan including the rollout plan
v Advisory services to the Board of GT
v Qualified expert staff, who will support the GT staff for a shorter or longer period.
The expert staff will cover all relevant areas in which GT is in need of training and know how transfer.
Project management expertise and systems
The Board of Directors of Ghana Telecom will upon the recommendation of the GT management procure such services. The seconded staff from TMP will stay in Ghana for the period decided by the board.
The payment for the services will be invoiced by TMP to Ghana Telecom. For services such as funding assistance, advisory services to the Board of Directors, systems and know how transfer Ghana Telecom will pay a fee of 4% of the profit before interest and tax. This means that 96% of the profits are available for reinvestments in Ghana Telecom or to the disposal of the shareholders. The minimum fee should, however, be $150.000 per month.
For services of expert personnel TMP will invoice in accordance with the procurement of such service by the Board of Directors of Ghana Telecom. Pursuant the MSA Ghana Telecom will provide accommodation and transport of a standard similar to what is common for other expatriate staff working in Ghana.
OBJECTIVES OF THE BUSINESS PLAN
The business plan sets out targets on which the rollout plans will be based. These targets include:
v 400.000 new fixed lines by the end of 2005
v Adequate and stable cellular coverage in all regional and district capitals
v Internet connection to all Senior Secondary Schools and Teacher Training Institutes within 3 years
v High speed data transmission capacity servicing both public and private customers demanding such services
Ghana Telecom is determined to meet these targets. As a commercial enterprise GT is demand driven. If demand requires an even higher number of lines or cellular coverage it is the business of GT to meet such demand. If on the other hand it should turn out that the market had been overestimated, plans would have to be adjusted accordingly.
To meet the objectives of the business plan a capital expenditure of close to $500 million is required. The investments will be funded by vendor financing, financing from financial institutions, new equity and by the operating cash flow generated by Ghana Telecom.
SUCCESS FEE OR DEFAULT PAYMENT
If under the TMP management the targets in the business plan related to profit, number of lines and number of subscribers is exceeded by 10% or more, a success fee of 4% of the net income attributable to the actual performance better than targets set and shall be determined at the Board of GT.
The default payment shall be 4% of the net income, which could have been earned, if the performance had been equal to the targets set and shall be determined by the Board of GT.
NEW MANAGEMENT
The Board of Directors of Ghana Telecom has appointed Mr. Oystein Bjorge of TMP as the new Chief Executive Officer as of Monday 27 January 2003. He will immediately start the work to implement the business plan. On short term this includes but is not limited to:
v Introduction of a new organisational structure as described in the business plan and to be finally approved by the Board
v Appointment of managers (with the exception of those to be appointed by the Government of Ghana) to fill positions in the new structure. Appointments will be based on the following criteria: Qualifications, integrity, attitude to work and working capacity
v Project planning and design including improvements and extensions
v Introduction of TMP personnel to work alongside the GT management and staff
