Was Masisi duped into Mascom wars?
- Masiyiwa sought Masisi into supporting Econet, MTN transaction
- I am not involved in their boardroom wars – Masisi
- Strive Masiyiwa hires PR firm to decampaign BPOPF
- BOCRA, Competition Authority oppose the deal
Telecommunications baron, Strive Masiyiwa is alleged to have played into President Mokgweetsi Masisi’s political vulnerability to have it seem like he supports his quest to take over Mascom shareholding, fresh information has surfaced.
Sources within the Mascom board reveal that Masiyiwa knew that in his political campaign, President Masisi needed to appease the unemployed youth. To Masiyiwa, sources say it was an opportunity to convince Masisi to partake in his town hall campaign to legitimize his quest to take over Mascom. Office of the President organized Masiyiwa’s town hall campaign, where Masisi deliberated the discussion with the belief that jobs will be availed for Batswana.
However, allegations are that Masiyiwa may have not told Masisi the whole truth; save only for that Botswana Public Officers Pension Fund (BPOPF) was in support of the deal. With the belief that BPOPF was in support of the deal, a senior official at Masisi’s office was ordered to invite Boitumelo Molefe, Principal Officer at the BPOPF to partake at the Town Hall discussion together with Masiyiwa and Masisi. It turns out that Molefe declined the invite, saying that she was not aware that Masiyiwa was buying a controlling stake in Mascom, which she clearly stated that the BPOPF was against.
In fact, The Botswana Gazette established that Masiyiwa, through his Company Econet sealed a deal with MTN in November 2018, for Econet to buy the 53 percent owned by MTN without the knowledge of BPOPF.
The plan was to get BPOPF to agree to the deal. Masisi hosted a press conference about two weeks back, where he said he was aware that he was being accused of supporting Strive and Econet at the expense of BPOPF. Then, Masisi said he was only trying to bring an investor into Botswana and that whatever boardroom wars existed at Mascom, he was not involved. “Let them sort out their boardroom wars,” he said.
What baffles the BPOPF is that Econet plans to sign a deal with MTN then facilitate the listing process in six months, list the shares on the Botswana Stock Exchange (BSE) and pocket the cash. It emerges that Econet could be planning to use proceeds of the Initial Public Offering (IPO) to pay MTN P3.1 billion. Efforts to solicit a comment from Econet were futile. The company, according to Lovemore Nyatsine Personal Assistant to Econet CEO will not be ready to provide details about the transaction until all conditions precedent have been met.
MTN Group CEO Rob Shuter announced in March this year that it was selling to Econet. Now that BPOPF has opposed the deal, MTN is under pressure to see it through. This past week, some members of the BPOPF board were in London on BPOPF business. The Botswana Gazette has evidence that Shuter also flew to London, chief of the reasons being to personally meet with Molefe to convince her into agreeing to the deal. Sources say however that Molefe would have none of it. MTN is reportedly under pressure because it announced to its shareholders that it would be selling the shares, so the shareholders were expecting P3.1 billion. Those in the know say that should the deal fail, MTN, a company listed on the Johannesburg Stock Exchange (JSE) risks losing significantly on its market value.
Molefe when contacted said BPOPF will oppose the transaction all the way. It emerges also that Botswana Communications Regulatory Authority (BOCRA) is against the deal. When contacted Aaron Nyelesi Director Corporate Communications & Consumer Affairs, said BOCRA was notified in terms of Section 43 (1) of the intended transaction pertaining to the sale of Mascom shares between current shareholders. He said BOCRA has taken cognizance of the discussions on the intended transaction however it would be premature for BOCRA to hazard an intervention at this juncture. When the time is right, BOCRA will do the needful and as mandated.
Asked on how and what prompts BOCRA to intervene, Nyelesi said under Section 43 (2) of the CRA Act, where the change in ownership would be “detrimental to the development of the telecommunications sector or would not facilitate the exercise of the functions of the Authority”, BOCRA has the discretion to revoke the licence.
“It follows that BOCRA’s intervention is guided by these principles and given that BOCRA is not privy to the intricacies of the transactions between the parties, the assessment of the elements of good faith and fairness are taken in the context of fairness and resultant effect on the industry as a whole rather than the parties involved,” he said. Competition Authority is also said to be against the transaction. While it is believed to have nothing to do with competition, sources say that the authority believes that the transaction is of public interest, given the pension fund shareholding. Gideon Nkala, Director of Communications and Advocacy at Competition Authority said the transaction has not been notified yet and as such the authority is unable to form any opinion on the matter.
For Econet, the war for the control of Mascom has turned dirtier, so much that a massive legal action is brewing behind the scenes. However, before the matter heads to court, Masiyiwa has engaged an international Public Relations company called Hill+Knowlton Strategies to ‘assist in providing a communications strategy and plan to help drive the transaction forward.’ Inside the proposal, this is labeled ‘Project Nehemiah’, H+K Strategies plans to decampaign BPOPF and also leverage on the goodwill of President Masisi and young people who were promised jobs by Masiyiwa.