AFRICA TELECOMS TODAY

Russian company gains a foothold in Zimbabwe
01/14/11, Biodun Omojola

Orascom, the majority shareholder in Telecel Zimbabwe, has sold 51 percent of its telecom interests to Russian mobile operator, Vimplecom. Vimplecom is Russia's second largest mobile company. The sale will give the Russian company 30 percent control of Zimbabwe's second largest mobile company. The deal is reportedly worth $6.6 billion, excluding Telecel's debt profile.

Orascom holds a controlling share of 60 percent in Telecel while the remaining 40 percent is owned by Empowerment Corporation. However, it remains unclear how the Zimbabwean authorities would treat the transaction in light of ongoing shareholder disputes between Orascom and the Empowerment Corporation. Reports say the foreign partners were allocated a 60 percent shareholding on the understanding that it would sell 20 percent to the Empowerment Corporation in 2005. But five years later, the shareholding issue has not been resolved.

Vimplecom agreed to merge with most of the telecoms assets of the Egyptian entrepreneur, to form the world's fifth largest mobile phone group by customers. The $6 billion deal is expected to transform Vimplecom - Russia's second largest mobile operator by subscribers - into a global group with businesses across the former Soviet Union, Asia, Africa and Italy. This sale is just one of a few done by Orascom as its sells some of its assets across the continent. It recently concluded the sale of its Internet arm, LINKdootnet and Link Egypt to Egyptian telecom company Mobinil.