Back to Index

Zimbabwe's Telecel seeks to raise USD24m for upgrade
Balancing Act
Extracted from News Update 207
May 16, 2004

Mobile cellular phone operator Telecel Zimbabwe (Pvt) Ltd is in talks with its international partner Orascom Telecom Holdings to raise USD24 million for its subscriber and network expansion. Marketing manager Obert Mandimika said the money raised would be used to expand the subscriber base to about 250,000. Currently Telecel has 127,000 subscribers.

"The board of directors is in consultation with the international shareholder to get assistance with the forex," he said. Mandimika said Telecel was waiting for both the approval and financial support from Orascom which is the largest shareholder in the telecommunications company. Orascom has a 60% sharehold-ing while Empowerment Corporation (EC) a consortium of local indigenous groups has the remaining 40% equity. Mandimika said of the US$24 million 75% would be raised through the internal operation.

"The money raised through international operations will be in Zimbabwe dollars and that money will be used to buy the forex at the forex auction system," Mandimika said. He said Orascom would weigh in with the remaining 25% of the money to be raised. "Orascom would provide that amount in foreign currency," he told businessdigest. "If Orascom gives Telecel the nod, subscriber and network expansion will be completed in the next four months." Orascom, Mandimika said, would assist in handling Telecel’s foreign suppliers like Siemens by giving them the bargaining power of a bigger group. Siemens and Orascom are in partnership in West Africa, North Africa and the Middle East.

Telecel Zimbabwe was granted a licence to operate in 1997 under the banner of black economic empowerment. At inception Telecel International owned 60%. EC, a fusion of indigenous group such as James Makam-ba’s Kestrel, Integrated Engi-neering Group, AffirmativeAction Group, IndigenousBusiness Women Organi-sation , Zimbabwe Farmers Union , National Social Security Authority and the Zimbabwe National Liberation War Veterans A sociation, had 40% equity. Orascom bought Telecel International’s stake in Telecel Zimbabwe last year.

Please credit www.kubatana.net if you make use of material from this website. This work is licensed under a Creative Commons License unless stated otherwise.

TOP