Business / Companies
Telecel acquisition concluded: Zimbabwe govt becomes major shareholder
09 Mar 2016 at 05:38hrs | Views
THE government is now the major shareholder in mobile phone company, Telecel Zimbabwe, after fully paying $40 million for the 60 percent stake in the firm previously owned by Russian telecoms group, Vimpelcom, an official said on Monday.
The government and Vimpelcom signed an agreement for the sale late last year.
Zarnet, a telecommunications company owned by government, acquired the stake on its behalf.
Vimpelcom said it would only transfer ownership after the Zimbabwean government, through its proxy, fully met the conditions of the sale.
Deputy Minister Information Communication Technology, Postal and Courier Services, Win Mlambo told journalists government had fully paid the purchase price last month.
"The government acquired Telecel using a special instrument from Zarnet and that has been completed," Mlambo said.
Vimpelcom decided to divest from Telecel after struggling to dilute its majority shareholding as required in terms of the country's indigenisation laws.
Local ownership laws demand that indigenous Zimbabweans own at least 51 percent in the firm.
The other 40 percent in Telecel was already owned by locals. Mlambo said the acquisition was smooth and did not cause any disruptions for the company.
"Taking over implies hostility, there was not anything hostile about it," Mlambo said, adding telecoms Minister, Supa Mandiwanzira would soon disclose in full details pertaining to the acquisition of the stake.
Reports last week indicated that pension fund, the National Social Security Authority had contributed $30 million out of the $40 that was required to acquire the stake. Zarnet had earlier paid a $10 million deposit.
Telecel is the country's smallest mobile phone services provider with an estimated 4.6 million subscribers at the end of October 2015. At the time, about 60 percent of its subscribers were said to be inactive according to the Postal and Telecommunications Regulatory Authority of Zimbabwe.
Through the Telecel acquisition, the government firmed its grip on the mobile telecoms sector as it already wholly owns NetOne, the second biggest network provider.
The government and Vimpelcom signed an agreement for the sale late last year.
Zarnet, a telecommunications company owned by government, acquired the stake on its behalf.
Vimpelcom said it would only transfer ownership after the Zimbabwean government, through its proxy, fully met the conditions of the sale.
Deputy Minister Information Communication Technology, Postal and Courier Services, Win Mlambo told journalists government had fully paid the purchase price last month.
"The government acquired Telecel using a special instrument from Zarnet and that has been completed," Mlambo said.
Local ownership laws demand that indigenous Zimbabweans own at least 51 percent in the firm.
The other 40 percent in Telecel was already owned by locals. Mlambo said the acquisition was smooth and did not cause any disruptions for the company.
"Taking over implies hostility, there was not anything hostile about it," Mlambo said, adding telecoms Minister, Supa Mandiwanzira would soon disclose in full details pertaining to the acquisition of the stake.
Reports last week indicated that pension fund, the National Social Security Authority had contributed $30 million out of the $40 that was required to acquire the stake. Zarnet had earlier paid a $10 million deposit.
Telecel is the country's smallest mobile phone services provider with an estimated 4.6 million subscribers at the end of October 2015. At the time, about 60 percent of its subscribers were said to be inactive according to the Postal and Telecommunications Regulatory Authority of Zimbabwe.
Through the Telecel acquisition, the government firmed its grip on the mobile telecoms sector as it already wholly owns NetOne, the second biggest network provider.
Source - New Ziana
