Lycamobile names CEO to lead digital push beyond expatriates

Lycamobile, the UK-based virtual network operator, has named Navanit Narayan as its new chief executive to lead a £70m investment push that will expand it beyond its traditional business of selling cheap airtime to expatriate communities.

Narayan joined Lycamobile in October as chief operating officer, having been chief strategy officer of Indian telecoms network Vodafone Idea before moving to the UK. He will replace Chris Tooley, who will join the company’s executive board.

Lycamobile, which has 16m customers across Europe, the US and Australia, is one of the world’s largest “virtual” networks, which piggyback on mobile networks such as O2’s in the UK to offer cheap services to customers.

The company’s exposure to migrant communities, however, has meant it has come under financial pressure during the pandemic with fewer migrants travelling to countries including the UK for work.

Narayan has been brought in to expand Lycamobile’s operations into new digital services including radio, video content, travel booking and mobile commerce. He told the Financial Times he also wanted to expand the Lyca brand nationally, cracking into “middle England”, and to expand its international presence by launching in more countries in regions including Latin America and Africa.

“We need to reinvent this business. It is a growing concern,” he said of the need to invest in its digital assets. Lycamobile is working with SAP, IBM and UK company Cerillion to transform its systems.

Lycamobile is chaired by Allirajah Subaskaran, who owns the business and controls a complex web of companies comprising its assets. It forged close ties with the Conservative party under David Cameron, becoming its biggest donor, and with Boris Johnson when he was mayor of London. It has ceased making political donations, according to its latest filed accounts.

The telecoms business was at the centre of an investigation into money laundering after a BuzzFeed investigation into suspicious financial activity and a tax dispute between the French and UK authorities.

Lycamobile’s UK accounts for 2019, the most recent published, also contain a £76m provision for the settlement of a tax bill with HM Revenue & Customs. The company has appealed against the demand, which covers the years 2013 to 2017, and remains in talks with the tax authorities.

The founders of rival Lebara attempted six years ago to move beyond ultra-cheap phone calls for migrant workers and turn their business into a “digital hub” but ended up selling it in 2018.

Narayan argued that the timing was better to target an expansion into digital services with more people locked down and using their phones for an array of services. “If we get this right we will be a very different company,” he said.