Airtel merged its Ghana arm into AirtelTigo in 2017, then handed it to the state

In 2017 Airtel merged its Ghana operations with those of Millicom, creating AirtelTigo, in which Airtel held a non-controlling 49.95% stake. Regulators approved the deal on the condition that the Ghanaian government could take a stake in the new entity in the future. Airtel had said it would consider consolidation, including exit, in markets where it was not among the top two players.

The merged company did not get there. Business Insider Africa reported that AirtelTigo became number three, behind MTN and Vodafone, and that Airtel's Ghana operations, with 5.1 million customers at the end of September 2020, had posted losses for the past four quarters.

In October 2020 Airtel's board approved the transfer of AirtelTigo to the Government of Ghana on a going-concern basis, with all customers, assets and agreed liabilities. Airtel told the Bombay Stock Exchange the agreement price was Rs 184.1 crore and that it was voluntarily taking an impairment charge of Rs 1,841 million. The Ghanaian ministry said the state would temporarily operate the carrier to protect jobs, customers and competition.

The 2017 merger produced a number-three operator in Ghana, behind MTN and Vodafone, rather than the top-two position Airtel said it needed.

The Ghana business kept losing money, with four consecutive quarters of losses reported before the sale.

Airtel's own stated policy was to consider exit where it was not in the top two, which left little reason to keep funding a third-place carrier.

A merger of two sub-scale players can still leave you sub-scale. If your own rule is to be top two or consolidate out, the merged entity has to clear that bar.

Airtel booked the impairment and agreed to hand AirtelTigo to the Government of Ghana in the late-2020 deal. Telecoms analyst Fouad Chalabi questioned the state's purchase of an unprofitable operator, warning it could signal that poorly performing firms would be bailed out.