Thursday, October 22, 2020

Strive Masiyiwa could be “Number One” because of BPOPF…

BY VICTOR BAATWENG

The founder of telecommunications operator -Mascom Wireless, Strive Masiyiwa could return as a major player in Botswana’s telecommunications sector. This follows reports that he could buy 44 percent stake belonging to South African teleco giant ÔÇô MTN Group Ltd.

Media reports in Zimbabwe, South Africa and Botswana were this week awash with reports of the buying back of more shares by Econet International Limited owned by Zimbabwean billionaire ÔÇô Masiyiwa.

In 2004, amidst discontent from minority shareholders of Econet Wireless Masiyiwa sold 44 percent of the business to South African telecoms powerhouse ÔÇôMTN for US$128 million.

Fast forward to March 2019, the MTN Group ltd has announced that it has since agreed to sell its 53 percent stake in Mascom back to Masiyiwa’s Econet for $300 million. This is an equivalent of about R4.3 billion or P3.2 billion.

The Johannesburg-based MTN Group ltd confirmed in a statement on Thursday that the selling was due to the “lack of control” over Mascom Wireless.

It is said that the South African based company – MTN was at the time of buying a stake in Mascom seeking to gain control of the local teleco and establish an MTN Botswana.

“Because of some complicated management contract that gave operational control to Portuguese Telecoms the plan never worked out”, said one source from across the border.

The MTN Group ltd also confirmed the exit reasons. “Pursuant to this it announced that it would be disposing of its associate in Botswana, Mascom, for $300 million where its lack of control position and MTN branding meant that the group is not able to execute on its BRIGHT strategy,” MTN said.

Mascom was Masiyiwa’s very first mobile operation, a licence he acquired in 1998 at a time when he was still battling to launch Econet in his home country – Zimbabwe.

Masiyiwa explained to some of his Facebook pages followers some few years back that the name Mascom was derived from Masiyiwa Communications. The name, he added was suggested to him by a business partner on the eve of the bidding process for the licence. Masiyiwa won the bid in a field that included more experienced regional operators such as France Telecom, MTN, Bharti Airtel and Vodacom.

It is not yet clear what sort of changes the Zimbabwean billionaire will bring to the local teleco which is yet to list its shares at the local bourse – Botswana Stock Exchange Limited (BSEL).

It is also not clear whether the changes in ownership will also result in changes in current complex management contract.

At the same time, sources from the industry have hinted on some “resistance” by one of the key player at the Mascom Wireless boardroom ÔÇô the BPOPF.

The BPOPF or Botswana Public Officers Pension Fund in full is currently the second largest shareholder in Mascom and is reportedly divided on whether to let Masiyiwa in or not.

ONE FOOT IN, ONE FOOT OUT

Meanwhile the future of Liquid Telecom, also owned by Strive Masiyiwa is in limbo following a drastic turn by the Botswana government which saw its power utility – Botswana Power Corporation (BPC) losing control of fibre cables to another state owned enterprise – BOFINET.

In mid 2018 the government of Botswana set up a ministerial committee that decided to transfer BPC’s fibre cables to BOFINET.

In October 2016, the power utility agreed to lease excess optical fibres from its network to Liquid Telecom ÔÇô a joint venture between the power utility company and Liquid Telecommunications Holdings Limited (LTHL).

An agreement to form the partnership was signed by Jacob Raleru, the former BPC CEO, and Nic Rudnick, Liquid Telecom Group CEO, in Gaborone where they announced that the joint venture will operate under the name Liquid Telecom Botswana, with BPC taking 42.5 percent stake in the newly created venture. At the time, the two partners said the structure of the deal will enable BPC to make more effective use of its existing assets, while allowing Liquid Telecom to better serve the network needs of its wholesale and enterprise customers in and outside the region.

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