This follows a move by the company to convert 1 166 906 618 debentures sold when the company issued a rights offer in February 2017 into ordinary shares at 93.3 ordinary shares for every 100 debentures held.
The move was supposed to be endorsed at the company’s annual general meeting on 29 November but was postponed to 14 December after objections from minority shareholders including some in the United States.
There was still no agreement on 14 December with the move being postponed indefinitely.
One of the major objections was that the conversion would only benefit Strive Masiyiwa who would make about $1.3 billion after purchasing the debentures for only $28 million in 2017.
Minority shareholders who bought into the company after the rights offer say the move to convert debentures into ordinary shares discriminates against them.
“There is no justification for this blatant disregard for the rights of minority shareholders,” Paul and Matthew Tierney of the United States wrote in a 27 November letter to the Zimbabwe Stock Exchange.
According to the Wall Street Journal other investors unhappy with the proposed conversion include financial-services companies Old Mutual Zimbabwe and Imara Securities as well as South Africa’s Coronation Fund Managers, Sanlam and Allan Grey, which together own some 25% of Econet.
The WSJ quotes Peter Townshend of Sanlam’s Africa Equity Fund as saying: “Mr Masiyiwa treats Econet as his personal company and minority investors get stiffed.”
Masiyiwa has been under the spotlight in the past few days after trying to come to the defence of his wife Tsitsi who was forced to close her twitter account after a backlash from a tweet last month.
Instead Masiyiwa got some bashing for being a bully himself.
He is also facing a media onslaught following a lawsuit by his company against four Zimbabweans based in South Africa who are accused by the company of making defamatory statements in videos that were posted on YouTube.
The videos have since been removed but Econet lawyers say the videos accused Econet of being a “mafia” and dodging taxes.