Monday, September 28, 2020

Government divided over BTC privatization

The government enclave is deeply divided over the privatisation of the Botswana Telecommunications Corporations.
For sometime, the divisions have been personified in the tension between BTC Chief Executive Officer, Vincent Seretse, and PEEPA Chief Executive Officer, Joshua Galeforolwe.

The duo first fought over the BTC mobile phone project. PEEPA felt that BTC should minimise investment and infrastructural development, including new technology deployment, because this could frustrate the privatisation process. The row was not helped by the opposing views held by Seretse and PEEPA on the BTC privatisation.

While PEEPA is advocating a straight forward equity sale, Seretse is rooting for other sale methods to be fully interrogated, such as straight initial public offering (IPO). Seretse complained that under the PEEPA privatisation route, extracting value from the sale of a national strategic asset is not being considered to be a primary objective.

The Sunday Standard can reveal that at a meeting held at The Office of The President sometime last year, Seretse argued that “privatisation structures via Strategic Equity Partner participation are generally motivated by the need to seek investment capital and/or to attract skills.” Seretse noted that “skills are commodities which can be secured through the payment of market related compensation and also that neither BTC nor the Government requires external capital in comparison with other countries. The need to focus on a strategic equity partner format should, therefore, be questioned.” For sometime, even the minister of Communications Science and Technology, Pelonomi Venson-Moitoi, seemed paralyzed by the privatisation row.

At that meeting, it is understood that the Minister, who recently went around the country telling Batswana to ready themselves to buy shares, confirmed that Batswana are ready. It is also understood that the Minister took some time to appreciate the point by Seretse to fast track the mobile phone project and at the same time wanted to unravel the controversy caused by conflicting views from PEEPA and BTC.

The division between PEEPA and BTC deepened after PEEPA, which is an advisory body with no powers to execute privatisation, was given the powers of attorney by government to advise and carry out the privatisation process.

This apparent conflict of interest has for sometime been stoking the already tense relationship between PEEPA and BTC management. BTC and PEEPA fought over the appointment of privatisation transaction advisors. While BTC, supported by the Business Advisory Council Board, Nico Czypionka, felt that it was prudent that they appointed their own in-house advisors, PEEPA, which had also appointed its own transaction advisors, were incensed by what they called duplication of efforts. There was even a fight over BTC’s refusal to pay more than P100 million in fees to advisors appointed by PEEPA arguing that they were footing the bill for their own in-house advisors. The tense relationship came to a head when Board members, who were in both the PEEPA and the BTC boards, were asked to choose between the two boards. Shirley Segokgo and Oabile Mabusa, who found themselves in the difficult situation grudgingly resigned from the PEEPA board. Sunday Standard can reveal that board chairperson, Leonard Makwinja, was highly concerned and sought advice that confirmed that, indeed, there was conflict of interest.

The board believed that the move was spearheaded by Seretse. This did not help the CEO’s already tense relationship with the board. ÔÇô READ INDEPTH FOR DETAILS

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