VimpelCom has bowed to pressure from Robert Mugabe’s government, selling Telecel Zimbabwe to state-owned Zarnet.
VimpelCom (NASDAQ:VIP) subsidiary Telecel Zimbabwe is to be sold to state-owned ISP Zarnet for US$40m.
The Russian company owns 51.9% of Global Telecom Holding (GTH), which made the agreement to sell its stake in Telecel International, which in turn owns 60% of number three cellco. The remainder of Telecel Zimbabwe is owned by local investor the Empowerment Corporation (EC).
CBZ reportedly acted as financial adviser to VimpelCom.
Also seen as contenders to buy out VimpelCom were rival state-owned group NetOne and South African giant MTN, which does not have a presence in Zimbabwe.
Telecel had been the subject of a drawn-out battle with the government. It was accused of not paying its licence fees or adhering to a 49% foreign ownership cap, and had its licence revoked earlier this year – a move VimpelCom successfully appealed in the courts.
Telecel currently competes with market leader Econet Wireless and state-owned NetOne. State-owned fixed-line incumbent TelOne owns a mobile licence that it does not yet use.
TelOne CEO Chipo Mtasa has indicated that she would like to share mobile infrastructure with an existing player, following government suggestions that it may make infrastructure sharing mandatory.
GTH, a subsidiary of Vimpelcom since its acquisition of Wind Telecom in 2011, also has subsidiaries in Algeria (Djezzy), Pakistan (Mobilink) and Bangladesh (Banglalink). As of 30 September, it claimed to have 84 million customers. Vimpelcom is now seeking to combine Italy’s Wind Telecommunicazioni, which it 100% owns following the 2011 deal, with 3 Italia.
