Orascom looks to reduce Telecel Zimbabwe stake

Orascom Telecom Holdings is looking to reduce its stake in the Zimbabwean mobile network, Telecel Zimbabwe to 49 per cent from 60 per cent and has entered into talks with Zimbabwe’s government about the sale.

The sale is to comply with the country’s restrictions on foreign ownership of businesses that limits them to a non-controlling stake. Zimbabwe’s Indigenisation and Economic Empowerment Act aims to transfer at least 51 per cent control of all foreign-owned firms, including mines and banks, to locals.

Although the law was passed three years ago, the current government announced last week that it will give companies 45 days to submit plans to explain how they will comply with the law. Any such plans will have to be implemented within six months.

Telecel Zimbabwe is the country’s second largest mobile-phone operator with 1.8 million subscribers, and is currently 40 per cent owned by a holding company controlled by president Robert Mugabe’s nephew, Leo Mugabe.