The Zimbabwean private equity firm Brainworks Capital Management has withdrawn its USD20 million offer to acquire the 40% interest in domestic mobile operator Telecel which is currently held by the Empowerment Corporation (E Corp) consortium. Protracted wrangles among E Corp members concerning the future of their shareholding and the exact make up of the consortium have led to Brainworks pulling out of the deal, according to a report from local newspaper The Herald.
Although it was initially reported that E Corp had agreed to Brainworks’ January 2015 offer, it soon emerged that not all of the consortium’s members were behind the sale, with Jane Mutasa’s Indigenous Business Women Organisation and a number of other shareholders challenging the move in court, saying the decision to accept the Brainworks offer had been made without consulting all E Corp members. The Herald reports that E Corp may now be dissolved and its collective 40% stake in Telecel split between the individual investors.
Separately, Telecel has denied claims that it has failed to pay for its operating licence and says the government would be wrong to follow up threats over the possible withdrawal of its concession. In a statement sent to the Zimbabwe Independent, Telecel’s communications and branding director, Obert Mandimika, said: ‘It is normal international practice to pay licence fees annually. Telecel is fully compliant with all due payments to date, as per the agreed payment terms set out by the Zimbabwean government.’ The cellco says it made an agreement with industry regulator POTRAZ in 2013 to pay its USD137 million licence fee in instalments, but the government is claiming that POTRAZ had no authority to make such an agreement. Information Minister Jonathan Moyo told the Independent: ‘The notion of annual payments is wishful nonsense with no legal basis. From this standpoint Telecel does not have a lawful licence and everyone concerned knows this legal position which is now being implemented in full by government without fear or favour.’