HomeBusiness DigestEconet fights Celtel for V-Mobile

Econet fights Celtel for V-Mobile

ECONET today resumes its legal battle in the Nigerian courts to win the right to purchase a controlling stake in Nigeria’s third largest mobile network operator, V-Mobile, a company in which Celtel International last week announced it had acquired a 65% stake for just over US$1 bill

ion.

The battle will be centred on whether Celtel, through its Kuwait-based parent, MTC, breached pre-emptive rights that allowed Econet the right of first refusal to acquire up to 65% of the company which it started in 2001 as Econet Wireless Nigeria.

Econet had received an offer from its other shareholders on April 18 to match Celtel’s offer within 30 days and had managed to raise US$1,5 billion in a shorter period but was unable to complete the transaction because of the absence of crucial documents needed before the funds could be released.

Econet group chief executive officer, Strive Masiyiwa, last week said he was unfazed by the Celtel purchase, arguing that Econet would prove in court today that V-Mobile had deliberately delayed providing crucial transaction documents that would have allowed Econet to complete the purchase of the company within the same window period that it had been given to respond to the Celtel offer to acquire the same shares.

Today’s case, before a Lagos federal court, will determine whether Celtel will have to reverse the purchase of V-Mobile.

Econet spokesman Sure Kamhunga confirmed that a hearing would be held in Lagos today but was unable to say whether a ruling would be made the same day.

“It’s difficult to say what will happen but obviously everyone is hoping for a speedy resolution to the issue,” he told businessdigest.

Econet wants the Nigerian courts to declare the Celtel purchase irregular and to order the Nigerian shareholders to release the documents required to complete the purchase. — Staff Writer.

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