Case Study Of Celtel

Decent Essays
III. Knowing when to play by the country’s rules, and when to refuse it

1. Demonstrate creativity to operate but never bribe anyone

Both Adesemi and Celtel had a very strong anti-corruption position. They would never bribe anyone or any institution as they knew other bribes would have to come afterwards.
But as TTCL and TCC officials were suggesting, in vain, that Adesemi could grease their palm, the company could not find any way to overcome the issue and operate.

As for Celtel, getting in countries with no network infrastructures was an operating challenge. Especially in countries embroiled in civil war such as Congo-Brazzaville. Licenses were usually cheap or free.
But it meant Celtel had to create its own network infrastructure, which
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Knowing when to back off and reverse

In 1999, Celtel purchased a mobile license in Guinea for $750,000, which was not a small sum for this young company. But Celtel still needed to sort out some issues such as interconnection agreement and import duties. In 2001, these issues had not been solved yet. Guinean officials would never answer or the meetings would never end. Eventually, someday, Celtel’s CEO, Sir Alan Rudge, who was trying to negotiate, received a fax with names and an amount next to each name ($50,000). This was the price Celtel had to pay to accelerate the negotiations. As they saw the situation was inextricable and as there was no way Celtel would ever bribe anyone, Celtel left Guinea.
Some would say Celtel lost $750,000, but Ibrahim and Alan Rudge knew this sum was a sunk cost. There was no time to lose, they had to move on, and they could do so as their investors and board members shared the same anti-corruption beliefs.

Adesemi would never give up on Tanzania, spending years and years trying to make it work despite the conflicts of interests and the multiple bribing requests from the officials. They eventually got bogged down in this never-ending loop until they went bankrupt.

3. Call in a third party only as a last
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