Zim government has no plans to merge Telecel and NetOne

1 Dec 2015

ICT, Postal & Courier Services Minister Supa Mandiwanzira has defended the Zimbabwean government’s move to take control of struggling mobile network operator Telecel, saying the state is looking to turn the business around and make it profitable. As reported by CommsUpdate last month, state-run ISP Zarnet has paid USD40 million to acquire a 60% stake in Telecel from Global Telecom Holding, which is itself 51.9% owned by Vimpelcom. Mandiwanzira has confirmed that Zarnet is now looking to buy the remaining 40% of Telecel which is held by Empowerment Corporation, a group of domestic investors.

The minister told local newspaper The Standard that there are no plans to combine Telecel with the country’s other state-run mobile operator, NetOne, saying that they should remain competitive in order to challenge the market leader, privately owned Econet Wireless. He said: ‘There is no immediate plan to merge. We believe they must compete on the market and the leadership [must] sweat to keep their jobs.’

Telecel has been under fire for some time over problems with its mobile licence renewal payments and also its ownership structure, with Zimbabwean law requiring the country’s telcos to be at least 51% domestically owned. The operator lost second position in the wireless market to state-owned NetOne in 2014, and claimed around 1.94 million subscribers by the end of June 2015, according to TeleGeography’s GlobalComms Database, behind NetOne’s 3.38 million and Econet’s 6.63 million.

Zimbabwe, NetOne, Telecel Zimbabwe