The Competition and Fair Trading Commission (CFTC) of Malawi has given the green light to TNM's acquisition of Open Connect Limited (OCL), a national fibre network operator, but with strict conditions. The acquisition, valued at K23.5 billion, includes OCL's fibre network, data centre, network equipment, vehicles, and enterprise contracts. The CFTC's decision was made at its 76th meeting held on September 30, 2026, after a thorough assessment of the proposed merger.
To ensure fair competition, the CFTC has ordered TNM to maintain all OCL employees and keep the open access and neutrality features of the wholesale fibre network intact. TNM must operate wholesale and retail functions as separate entities with independent board oversight. The commission also stipulated that TNM will be under regulatory surveillance for three years, with a formal Memorandum of Understanding (MoU) in place to monitor compliance.
CFTC chief executive officer Desmond Kaunda acknowledged the risks associated with merging an upstream wholesale provider with a downstream retail operator. He noted that this could lead to the loss of OCL's neutral open-access framework and potential misuse of competitors' traffic data. However, Kaunda emphasised that the integration would generate operational efficiencies, lower distribution costs, and secure needed capital to upgrade failing network infrastructure.
The acquisition of OCL by TNM has elicited mixed reactions from analysts. Some have highlighted potential efficiency gains, while others have expressed concerns about unclear benefits. Capital market analyst and investor Benedict Nkhoma stated that the transaction's success will depend on valuation and integration costs. He noted that the CFTC's review is a safeguard against potential consumer harm through higher prices or reduced choice.
Other analysts have shared their views on the acquisition. Investment analyst Brian Kampanje argued that shareholders need more information, saying the deal does not appear to deliver economies of scale. In contrast, stockbrokers Malawi equity investment analyst Kondwani Makwakwa described the acquisition as strategic, saying it would strengthen TNM's control over critical infrastructure, enhance service quality, and reduce long-term operating costs.
Equity Masters Limited board member Purity Chitalo viewed the move as a standard growth strategy, noting that TNM's 2017 acquisition of Burco Limited delivered tangible benefits, including new WiFi clients and technical expertise. OCL operates a national fibre network, providing wholesale capacity to mobile operators. The acquisition is expected to save a failing firm, preserve approximately 40 jobs, and support digital infrastructure development without imposing adverse fiscal burdens on the state.
The CFTC's decision to authorise the acquisition with conditions aims to balance the need for operational efficiencies with the need to protect competition and consumers. The commission found that the most critical public interest consideration is saving a failing firm, as OCL faces severe financial distress and negative working capital. The acquisition provides essential recapitalisation, prevents asset collapse, and supports digital infrastructure development.
Key points
- The CFTC has authorised TNM's acquisition of OCL with conditions to prevent anti-competitive conduct and ensure fair competition.
- The acquisition is valued at K23.5 billion and includes OCL's fibre network, data centre, network equipment, vehicles, and enterprise contracts.
- The CFTC will monitor TNM's compliance with the conditions for three years under a formal Memorandum of Understanding (MoU).
