Zimbabwe government fund wants control of Telecel

22 Aug 2016

The Zimbabwe government’s social security and pensions fund, the National Social Security Authority (NSSA), is looking to gain control of the country’s third mobile operator, Telecel. In November 2015 the state agreed to acquire a 60% interest in Telecel from multinational telecoms group VimpelCom, with the transaction to be conducted by government-backed ISP Zarnet. The NSSA initially agreed to provide Zarnet with a ten-year loan to cover the USD40 million cost of the transaction, but a report from the Zimbabwe Independent says that the fund is now worried that the ISP will be unable to make the repayments and it is therefore looking to take over the 60% stake in the cellco itself.

While the government announced that the deal had been completed earlier this year, VimpelCom subsequently contradicted this, saying that it was still waiting for the payment to be made. It is thought that only USD6 million of the USD40 million purchase price has so far been handed over. VimpelCom had been under pressure for some time to reduce its stake in Telecel to comply with Zimbabwe’s 49% foreign ownership limit, and the group eventually put its shares in the telco up for sale in December 2014. The remaining 40% of Telecel is held by a consortium of local businesses under the name Empowerment Corporation (E Corp). Telecel claims around 15% of Zimbabwe’s 13 million wireless subscribers, according to TeleGeography’s GlobalComms Database.

Zimbabwe, Telecel Zimbabwe, VEON