MAROC_TELECOM_REGISTRATION_DOCUMENT_2017

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DESCRIPTION OF THE GROUP, BUSINESS ACTIVITIES, LEGAL AND ARBITRATION PROCEEDINGS Business activities

In Marchb1999, Gabon Telecom created Libertis, its wholly owned mobile subsidiary, which obtained a second license to operate a GSMMobile telephony network in 2007.bUntil 2006, Gabon Telecom was wholly owned by the Gabonese government. In Februaryb2007, following an international invitation to tender, the Gabonese government sold a 51% stake in the company to Maroc Telecom. The transaction was finalized on Decemberb23, 2010, following completion of the agreements signed in 2008. Gabon Telecom’s Extraordinary Shareholders’ Meeting of Decemberb20, 2011 approved plans tomerge with Gabon Telecom’s Mobile subsidiary. Since then, Gabon Telecom has become a global operator, capitalizing on the synergy between its Fixed-line, Mobile and Internet businesses. In addition, after the acquisition of Moov Gabon in Januaryb2015, and to comply with the country’s regulatory requirements, a merger between Gabon Telecom and Moov Gabon was necessary. The merger-absorption process for Gabon Telecom and Moov Gabon was finalized in Juneb2016. On Juneb20, 2017 Gabon Telecom’s universal license was renewed for a period of 10 years at a cost of MAD 148 million. Maroc Telecom’s representatives sit on the Board of Directors of Gabon Telecom. Maroc Telecom has no Executive Directors within these companies. The consolidation methods for Gabon Telecom and its subsidiaries are summarized in Notesb1, 2 and 28 to the consolidated financial statements. In addition, Sectionb2.3.4 “Related-party transactions” illustrates the type of financial flows between Maroc Telecom and the Gabon Telecom sub-group. Fixed-line telephony, data and internet Gabon Telecom provides Fixed-line telephony services (voice and data) as well as ADSL and FTTH internet access to residential customers, companies and the public sector. Gabon Telecom lost its monopoly on basic services (domestic Fixed-line telephony, telex, and telegraph) on Decemberb31, 2005. However, it currently remains the sole national fixed-line operator in Gabon. By contrast, Gabon Telecom competes with other service providers in the internet and VSAT markets. At end-Decemberb2017, the operator had a Fixed-line customer base of 21,235 lines, an increase of 12.6%. The fixed-line penetration rate still remains low, at only 1% at end-Decemberb2017. Gabon Telecom also offers internet access via its fixed-line network (high-speed ADSL and fiber optic). At end-Decemberb2017, Gabon Telecom had 16,187 internet subscribers, up 23.4%byear-on-year. Gabon Telecom has access to thebSAT-3 submarine cable, which enables it to cover its own international bandwidth needs and to offer international services (internet, voice) to other telecoms operators and Gabonese firms. Mobile telephony Gabon Telecom’s Mobile segment, marketed under the Libertis and Moov brands, provides prepaid and postpaid services and offers voice and data plans (mainly SMS and mobile internet). It also provides roaming services for its mobile subscribers abroad for customers of foreign partner operators visiting Gabon. In 2014 Gabon Telecom launched its m-payment service under theMobicash brand as well as other 3G and 4G services.

COMPETITION AND MARKET SHARE Mobile market trends in Gabon

175%

158%

152%

3.3

2.9

2.8

2015

2016

2017

Customer base (in millions)

Penetration rate

Source: IMF and Dataxis Mobile market share in Gabon at December 31, 2017

5 % Azur

54 % Gabon Telecom

41 % Airtel

Source: Dataxis At Decemberb31, 2017, there were 3.3bmillion Mobile customers (commercial customer base), representing a penetration rate of 175%, up 11 points in one year. The GabonMobilemarket is highly competitive, with three operators for 2G networks. In addition to Gabon Telecom, Airtel and Azur (network launched in mid-2009) are very active in the country. Despite this competitive landscape, Gabon Telecom succeeded in capturing a leading market share of 56% at end-Decemberb2017. At Decemberb31, 2017, Gabon Telecom had 1.5 million customers (almost all prepaid), an 8.4% decrease (due to the merger between Gabon Telecom and Moov Gabon). Gabon Telecom continued to build its mobile network in 2017, raising its total number of BTS to 1,184. PERFORMANCE The following table shows Gabon Telecom’s key operating data:

Unit

2017

2016

2015

Mobile customerbbase (000)

1,547 1,690 1,157

Fixed-line

(000) (000)

21 16

19 13

19 11

Broadband access

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MAROC TELECOM ____ 2017 Registration Document