Govt, Nssa pen Telecel agreement

Source: Govt, Nssa pen Telecel agreement – DailyNews Live

Ndakaziva Majaka      30 May 2017

HARARE – National Social Security Authority (Nssa) will relinquish its
controlling stake in Telecel Zimbabwe (TZ) to Zarnet after three years,
following a recent agreement inked to this effect, it has emerged.

The State-run pension fund’s general manager Elizabeth Chitiga on Friday
said Nssa and Zarnet had agreed on the deal’s terms following negotiations
to restructure the financing deal that saw Zarnet acquire 100 percent
equity in Telecel International – which owns 60 percent of TZ – through a
transfer of rights and buy-back agreement.

“The agreements have been signed to that effect… As the chairman has
previously stated negotiations were going on and I am sure he also spoke
about it in his last quarterly update,” Chitiga said on the side-lines of
a media cocktail.

The recent development follows an earlier announcement by Nssa
chairperson, Robin Vela, stating that the parties were in advanced

“The two parties are in advanced negotiations in relation to restructuring
the transaction; wherein from a Nssa perspective it will culminate in an
acceptable equity return and enhanced security arrangements, whilst the
Zarnet perspective translates to a feasible and favourable financing

“The effect of the new dispensation is that Zarnet will exercise the
buy-back over a three-year period on terms enshrined in a new agreement
involving a number of related-parties to Zarnet,” Vela said, in his fourth
quarter 2016 update.

Zarnet’s acquisition of the TZ stake was achieved through a mezzanine
structure valued at $30 million, provided by Nssa, after government came
up with a $10 million deposit in the $40 million deal.

Marred in controversy, the transaction gives government controlling stake
in the country’s third largest mobile network operator to the little known
government Internet provider, Zarnet.

Reports last year indicated that Nssa was not “entirely happy” about the
prospect of losing out on an equity holding in TZ – or just playing the
role of a financier and – where it sees huge opportunities for rich
pickings, and acquiring an asset that can add value to its policy holders.

Information Communication Technology minister, Supa Mandiwanzira, recently
said as majority shareholder, government was now moving to fully acquire
the network and “sanitise it” with a possible private listing on the

“Efforts to sanitise the `shareholder wars’ and eventually make the
business private through listing or selling, et cetera continue.  Advisors
will advise us which route to take,” he said.