An Egyptian company which holds a controlling stake in Zimbabwe's Telecel mobile provider but has been under pressure to cede control to an indigenization or black empowerment group has announced that it will scale down its stake.
Telecel Globe, a subsidiary of Orascom (Pvt) Limited of Egypt, has a 60 percent stake in Telecel but will scale down its stake to 49 percent.
Sources said the decision followed pressure from Leo Mugabe, nephew of President Robert Mugabe, who has been seeking a majority stake in the mobile company.
Telecel Globe is to sell shares to an indigenous consortium led by Leo Mugabe, whose Zimbabwe Wealth Creation and Empowerment Council maintains that it was tricked into settling for a minority position in the company soon after its formation.
The council comprises the Affirmative Action Group, the Indigenous Business Women’s Organization, the National Miners Association, the Zimbabwe Farmers Union, the Zimbabwe War Veterans Association and several other organizations.
Economic commentator Rejoice Ngwenya told VOA Studio 7 reporter Gibbs Dube that developments at Telecel are sending a negative signal to investors.
“This is worsened by conflicting interests of the ruling parties with some threatening to seize British and American companies whose counties imposed targeted sanctions on President Robert Mugabe and his inner circle,” Ngwenya said.