Friday, September 30, 2022

“BTC privatization on course” PEEPA

Dear Editor

The Government of Botswana, pursuant to its Privatisation Policy, decided in June 2006 to privatise BTC. In order to implement Government’s decision, the following key stakeholders had to be involved: the Ministry of Communications, Science and Technology, as BTC’s parent Ministry and Government’s shareholder representative, the Public Procurement and Asset Disposal Board (PPADB) as the authority with powers to regulate and approve the sale of Government’s assets, PEEPA, as Government’s advisor on privatisation and BTC as the entity to be privatised.

As PEEPA’s role is primarily to advise on all matters relating to privatisation, it has often advised its client Ministries to ensure that parastatals exercise caution in making major investments on the eve of privatisation to avoid private investors discounting the investment when bidding for privatisation assets. In deed, such an advice was given with respect to BTC and, notwithstanding, Government decided that the introduction of mobile telephone services was essential to position BTC to compete effectively and to safeguard its market share, a position that BTC, as an operator, advocated for.

The Privatisation Policy and Master Plan mandate PEEPA to advise on privatisation and to “…….assist in the privatisation transactions following approval by Government”. Therefore the authority conferred on PEEPA by MCST to assist with implementation of BTC privatisation is consistent with privatisation founding documents. Since Government approves the recommendations, their implementation by PEEPA, on behalf of MCST, can not be considered to constitute a conflict of interest.

The authority delegated to PEEPA is only confined to the implementation of the transaction following Government’s approval and PEEPA can not be expected to manage BTC as you allege. As we have stated before, there have been constructive discussions between PEEPA and BTC over how the privatisation of BTC should be structured. The discussions of these issues form part of the mandate of the transaction advisors which has always been to interrogate all privatisation options and to recommend on the most appropriate and optional privatisation structure. These options include amongst others, identifying a strategic equity partner first and then followed by the listing of shares on the stock market or vice versa or doing both concurrently for that matter. As PEEPA has always maintained, a healthy and objective debate is central to ensuring the alignment of the interests of the different arms of Government, if privatisation interventions recommended are to bear fruit.

With regard to your suggestion that there is a potential conflict of interest by virtue of Mr. O. Mabusa and Ms. S. Segokgo, serving on both PEEPA and BTC Boards, we would like to state that the Appointing Authorities, having taken appropriate advice, concluded that there was no conflict of interest. Accordingly, the mentioned Directors continue to serve on both boards and have never resigned from either of the Boards on account of the alleged conflict of interest.

Finally, it is ridiculous and a figment of the author’s imagination to suggest that the decision of the Appointing Authority over the employment contract of the BTC’s Chief Executive Officer has been influenced in any way by the issues which PEEPA has been advising on.
We have asked the Sunday Standard before that it is only fair that you afford us the opportunity to give our side of the story. We expect nothing more than that and hope we are not asking too much.

Yours sincerely,

J.B. Galeforolwe


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