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The issue of Telecel Zimbabwe’s ownership and its potential sale, which has been played out in the media for most of this year left most of us with the impression that the Government had all but secured a stake in the mobile network operator.
It turns out, however, that Telecel Zimbabwe’s majority shareholder, Vimpelcom, is going to hold on to its stake and has a long term interest in the operator, It will, however, sell if the need arises, but will not give up of its stake in Telecel Zimbabwe for free. It will charge the market value for the shares to any interested bidder.
Yesterday, Vimplecom spoke to Zimbabwean media in Netherlands and the reports coming out of Amsterdam point out some important facts in the yet to be resolved Telecel Zimbabwe ownership issue.
1.Vimplecom is committed to Telecel Zimbabwe and has started contributing to turnaround strategy for the mobile operator through the deployment of expertise from Vimpelcom to assist in the execution of technical, market and commercial strategy.
2. According to Newsday, Vimplecom has stated that while it has committed to Zimbabwe, it will consider selling if the government continues to put pressure on its operations.
3. Government interference affected the completion of a deal that could have led to a change in Telecel’s ownership. An article in The Herald quotes Anton Kudryshov, the Chief Group Business Development Officer for Vimplecom as having said,
We were approached by potential buyers towards the end of last year. Some of the offers were attractive reflecting the potential of the business. We were in advanced negotiations with another buyer. However, we could not complete this process due to Government interference.
4. The discussions with Zarnet as a potential buyer of Telecel are ongoing. No sale has been made and nothing has been signed off which places Zarnet/the government in the same pool as other potential buyers. However, Vimpelcom seems to be unsure of Zarnet’s ability to make the right offer since it,
…is now looking for proof that Zarnet has funding for the transaction.
Beyond the very important concerns raised by Vimpelcom around government interference and the need for a conducive environment for foreign investment, one underlying aspect that seems to have been raised is how the Telecel ownership will be handled like a business deal first, and not a political move.
Vimpelcom’s insistence for the best value for its shareholding is a bold statement that any investor in Telecel, whether public or private, will have to appreciate. Any threats on licence issues won’t erode the asking price that Vimpelcom will attach to its investment.
If anyone, including the government, wants to have a stake in Telecel Zimbabwe, they will have to pony up the right amount.
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