Clemencia Jacobs
24 June 2011
Telecel Globe has finalised an agreement to sell its subsidiary, PowerCom, to Investec and Nedbank amidst reports of financial trouble. Stanley Similo, chief human resources, corporate & regulatory affairs officer at Leo, declined to comment on the matter this week, saying “we have nothing more to say at this stage.”
Mike Peo, head of Infrastructure, Energy and Telecommunications at Nedbank Capital, also refused to comment saying: “Nedbank’s stance on this matter and response to the media is that we will not be providing any further commentary to the media, other than what was issued in the PowerComLeo media release.” According to Similo, the sale process was initiated by Telecel Globe and started in 2010.
“The sale involves Investec Bank and Nedbank Capital, a division of Nedbank, acting through a Namibian company which will acquire all shares in PowerCom. This change in ownership has been discussed with our line Ministry of Information and Communications Technology and Communications Regulatory Authority of Namibia (CRAN) and is subject to approval from those authorities which is expected soon,” he said in a statement.
Ahmed Abou Doma, Orascom’s CEO said the sale which includes the liabilities of PowerCom – totalling about N$408 million – would strengthen ties with local partners. “We consider this transaction to be positive for Powercom as it strengthens the company through solid local partners. This is also in line with our overall company strategy to focus on profitable growth,” he said. Telecel Globe acquired 100% of Cell One’s shares in 2009, in a N$580 million deal. Before this NamPower had a 37% share, Telecom Management Partner (TMP) had 39%, Zeven Investment Corporation had a 12% stake, while Old Mutual had 10% and the PowerCom Educational Development Trust, 2%.
Leo had 251,000 subscribers in the second half of 2010 down 4.9% from the previous quarter, according to a report by Investment House Namibia.
In an aggressive marketing move, leo announced late this week that it has dropped its call charge to 38 cents a minute if a conversation lasts longer than three minutes. In a bold email flyer leo invited mobile users, both prepaid and account, to make user of the special offer. “Speak for a total of three minutes (on standard rate) and the rest of all your calls for the day will be billed at only 38c/min, until 12pm at night,” the mobile operator told its prepaid clients, while postpaid clients are offered: “Speak for three consecutive minutes, and you will only be charged 38c/min, from the fourth minute onwards.”
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Original post:
Leo Evasive on Terms of Sale