Zimbabwe billionaire struggles to sell telecom asset
The coronavirus pandemic is hampering efforts by Zimbabwean
billionaire Strive Masiyiwa to sell a stake in Africa’s largest fibre company.
Masiyiwa is seeking buyers for 20% to 34% of Liquid
Telecommunications for as much as $600 million, according to four people with
direct knowledge of the matter. He needs the money to repay a $375-million loan
that was backed by the Public Investment Corp, the continent’s largest money
manager, they said.
The PIC, which oversees the equivalent of $135 billion
mainly on behalf of South African government workers, is demanding the issue be
resolved by the end of August after granting an extension on the payment
earlier this year, the people said. The loan it backed was used to fund a
pay-TV venture, which failed last year because Zimbabwe’s economic woes and
currency shortages meant the company couldn’t pay suppliers.
The 59-year-old tycoon had pledged shares in Liquid Telecom
to the PIC as security for the loan, which had been taken out with Deutsche
Bank. Masiyiwa was planning to repay the debt from the proceeds of an initial
public offering in Liquid Telecom, which was scrapped because of volatile
equity markets, the people said.
The founder of Econet Global, which has interests in
mobile-phone network operators and digital-banking operations across the
continent, would rather sell part of his 66% stake in Liquid Telecom to avoid
surrendering shares in the company at a discount to the PIC, one of the people
said.
Masiyiwa hired Goldman Sachs earlier this year to sell the
stake, but talks with potential investors started unravelling after the
Covid-19 outbreak intensified in March, the people said. Buyers wanted more
time to assess the economic fallout of lockdowns to contain the virus on
Africa’s economies, they said.
Representatives for the PIC, Goldman Sachs, Deutsche Bank
and Econet declined to comment.
Liquid Telecom operates in 13 countries in East, Central and
southern Africa with data centres in Johannesburg, Cape Town and Nairobi. It
also offers cloud-based services from Microsoft, according to its website. UK
development finance institution CDC in December 2018 bought almost 10% of
Liquid Telecom for $180 million.
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