Econet buys Altech out of joint venture

ECONET Wireless Group has agreed to buy IT firm Allied Technologies’ stake in their telecoms joint venture for US$87,5 million, ending a spat between the two.


Alt

ech, which has interests in telecoms, electronics and other technology ventures, said the two companies had agreed to waive any claims against each other and abandon the Altech Econet Wireless joint venture, leaving Econet with sole control.


“Altech will continue to pursue opportunities to acquire and develop interests in network operating activities in Africa and elsewhere in the future,” Altech said in a statement, adding that it would team up with existing operators where appropriate.


Altech earlier last month said it had applied to wind up its joint venture with Econet or sell its stake to the company for US$100 million, after the two firms fell out.


Altech blamed irreconcilable differences between the two companies in their management cultures, while Econet chief executive Strive Masiyiwa said they fell out over a court case involving comments by an Altech executive.

Altech invested $70 million on December 24 to form the Altech Econet Wireless venture, which includes a disputed 5% stake in Nigeria’s third-biggest cellphone operator, Vmobile, a majority stake in a New Zealand mobile operator and a satellite firm in the UK.


Vodacom and Britain’s Virgin have bid for a controlling stake in Vmobile, but the offer has been put on ice until a verdict is reached on whether Econet, which helped to found Vmobile, has pre-emptive rights to increase its stake.


The joint venture did not include Econet’s largely dormant SA assets, its mobile firm Econet Zimbabwe, shares in start-up Econet Wireless Kenya and telecom operations in Lesotho.


Altech said on Wednesday it would get the US$87,5 million in three tranches, with the final payment on October 29.


Econet declined immediate comment. – Reuter.