After several weeks of uncertainty, the Zimbabwean government and regulator have agreed to renew the 2G/3G licence held by Orascom Telecom’s Telecel Zimbabwe.
The renewal fee amounts to US$137.5m for the twenty-year licence, Egypt-based Orascom said…
After several weeks of uncertainty, the Zimbabwean government and regulator have agreed to renew the 2G/3G licence held by Orascom Telecom’s Telecel Zimbabwe.
The renewal fee amounts to US$137.5m for the twenty-year licence, Egypt-based Orascom said in a stock exchange filing.
In late May the Zimbabwean government had warned Orascom that it would not renew Telecel’s 15-year licence unless local shareholders acquire a majority stake.
The Egyptian company owns 60% of Zimbabwe’s second-largest mobile operator, via its subsidiary Telecel Globe. The Empowerment Corporation, a local group, owns the remaining 40%.
Under local foreign ownership regulations, Orascom was required to sell a 20% stake to local shareholders within five years of receiving the licence in 1998.
Reports also suggest that Telecel is in breach of the controversial Indigenisation and Economic Empowerment Act, which stipulates that previously-marginalised black Zimbabweans must hold at least 51% in any local registered firm.
Today (7 August), both Orascom and Telecel confirmed that the shareholding structure currently remains unchanged but that efforts are being made to address this issue and comply with local regulations.
“The regulator has indicated in a statement on the renewal of the licence that this is a condition that has to be resolved very urgently,” a Telecel spokesperson said in an email.
Commenting on the government’s and regulator’s decision, Orascom’s CEO Ahmed Abou Doma said: “I am very glad that we reached this agreement with the government of Zimbabwe. We will continue our drive to develop this market and bring the latest international technology and know-how to serve our increasing customer base in Zimbabwe.”
The decision to renew the operator’s licence comes just a week after the general election in the country, which saw incumbent president Robert Mugabe being re-elected. Several countries have raised concerns about the credibility of the election results.
