So it’s already been confirmed, the government is moving in on Telecel. Earlier today, the Minister of ICT, Supa Mandiwanzira, responded to questions on the government’s interest in Telecel Zimbabwe by referencing the same remarks he shared in Parliament yesterday.
A report carried in the Herald cites the Minister’s response to questions that were raised by other legislators regarding the takeover of Telecel. Mandiwanzira mentioned that the government, through state-owned Internet Service Provider ZARNet, is in negotiations to buy Telecel with another local institution, CBZ Bank facilitating the deal and acting as the financial adviser.
According to the Minister, ZARNet has been roped in because the government does not have the immediate capacity to execute this takeover. All this has come after the government accepted the offers made by the Empowerment Corporation and Vimpelcom, the two shareholders in Telecel Zimbabwe, to offload their stakes.
One issue that hasn’t been clarified is how the Telecel takeover will be financed. ZARNet is hardly primed to handle a huge takeover of a mobile operator. The operator that would have seemed geared for any sort of MNO deal, TelOne, is already licenced and making plans to launch its own mobile network.
This will, in all likelihood, be executed with leveraged finance. Speaking after today’s breakfast meeting, Mandiwanzira pointed out that globally,
..markets are awash with capital for telecoms deals.
If you pair that, with the information he shared with the Parliamentary Portfolio Committee on ICT some months ago on the handful of offers that have been made for Telecel from foreign investors, the operator is looking at outside investment. The only difference this time will likely be an enforcement of indigenisation laws.
One strong possibility could be Chinese investment. Chinese capital has oiled projects for the government’s own mobile operator, NetOne, and through the same Zim-Sino understanding, projects like the National Digital Migration and NetOne’s LTE expansion have been carried out.
With a strong push made in solidifying these relations and negotiating other mega deals from our friends from the East, maybe Telecel will move from Dutch investors to Asian investors that already have a finger in the Zimbabwean tech pie.