Who is really bailing out Econet Zimbabwe?


Results of the $130 million Econet Wireless Zimbabwe Rights issue which opened on 20 February will only be known next week but the securities will be listed tomorrow.

The results of the rights offer will be published next Monday, 27 March but payments should be cleared by Wednesday, 22March.

The offer was underwritten by Econet Global raising questions as to whether this was not another way for Econet founder Strive Masiyiwa to increase his stake in the company.

Econet Global is registered in Mauritius, a tax haven.

Although guaranteeing the rights offer Econet Global has been charging the Zimbabwean company 6 percent for guaranteeing the loans the company obtained from the China Development Bank, Ericsson, African Export and Import Bank and the Industrial Development Bank.

The mobile telecommunications company obtained loans totaling $326.6 million from the four financiers but now has $128.2 million outstanding.

What has also raised eyebrows is that only $13.2 million of this is required by 12 April while the bulk of the amount, $75 million, should be paid by 21 August 2019.

According to calculations done for The Insider Econet Zimbabwe could have paid as much as $85.6 million in guarantee fees to Econet Global.

The calculations showed that the least amount it could have paid is $48.5 million.


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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.


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