NASDAQ-listed global telecoms giant, VimpelCom has agreed to sell its majority shareholding in Zimbabwe’s third largest mobile network operator Telecel Zimbabwe to the tune of US$40 million as government tightens its control on the country’s telecoms sector.
As first reported by the Zimbabwe Independent last Friday, the Amsterdam-based telecoms firm on Wednesday announced that it had entered into an agreement with government to sell its 60% stake to a chaotic quasi-government entity, Zarnet.
“VimpelCom Ltd., a leading international provider of telecommunications services headquartered in Amsterdam, today announced that its 51,9% owned subsidiary, Global Telecom Holding S.A.E, has entered into an agreement with ZarNet (Private) Limited to sell its stake in Telecel International Limited for US$40 million. Telecel International owns 60% of Telecel Zimbabwe (Pvt) Ltd,” Vimpelcom said today.
“Transfer of ownership to ZarNet will occur after customary conditions are satisfied. ZarNet is wholly owned by the Government of the Republic of Zimbabwe through the Ministry of Information & Communication Technology, Postal and Courier Services.”
The Independent last week broke the exclusive story exclusively and provided detail.
Zimbabwe has three mobile operators. Government already owns NetOne, the second largest operator after Econet Wireless. Econet is owned by one of the country’s most prominent entrepreneurs Strive Masiyiwa.
Government’s takeover of Telecel means, by default the state is now the biggest telecoms player as it also owns
TelOne is Zimbabwe’s sole fixed telecommunication services provider 100% owned by the government. It also provides voice, internet and data services.
Telecel Zimbabwe is jointly owned by Telecel International, which has 60%, and Empowerment Corporation (EC), a Zimbabwean consortium made up of a number of local companies and investors who control 40% of the company.
Zarnet was founded in 1997 and has been operating as an internet service provider. According to a report on parastatals by Auditor-General Mildred Chiri for the financial year-ended December 31 2014, Zarnet is a broke entity.
This is not the first time VimpelCom has divested itself of its mobile interests. In October 2014, it sold its mobile networks in the Central African Republic and Burundi to Zimbabwe’s leading mobile operator, Econet Wireless.
NetOne was the first cellular network operator in Zimbabwe after its launch in September 1996 in Harare. It is wholly owned by government. Econet was formed two years later in 1998. Telecel was launched in 1997.
Government is also moving to force mobile operators to share infrastructure as it seeks to control the market and contain Econet which has been the dominant player more than a decade now.
Zimbabwe has generally refused to allow big global telecoms giants to enter the market as government seeks to maintain control and retain reins on the critical space occupied by the telecoms sector.
It is currently working on a number of bills to control cyber-security and spy on citizens. Already there is a law which allows it to eavesdrop, the Interception of Communications Act.-Staff Writer