Telecom Namibia (TN) will be reimbursed U$3million (approximately N$42.6m) from their botched investment made by the company in Angola in 2003, The Villager can reveal.
The State-owned company has been in a financial quagmire and failed dismally to accrue benefits from an investment they made in the Angolan counterpart Mundo Startel with a bid to expand their influence.
Head of Corporate Communications and Public Relations at Telecom Namibia, Oiva Angula confirmed to The Villager this week that TN negotiated a final exit from the deal it clinched with the Angolan telecommunications company.
“Kindly be informed that Telecom Namibia is busy disengaging from its Angolan joint venture, Mundo Startel. This process has been initiated already. How long this will take is difficult to tell at the moment. However, the investment in Mundo Startel was fully- impaired during the 2014/2015 financial year,” Angula stated.
He added that as soon as the process has been completed, a media statement will be released in the public interest. The deal, which was sealed in Luanda, saw Telecom invest US$14 million (N$91 million at that year’s exchange rate) over three years.
In 2003, Telecom Namibia entered into the Angolan telecommunications’ market with the acquisition of a 44% stake in Mundo Startel, and gave a loan worth N$174m to that company. In 2013, the global ratings’ agency Fitch, which lowered the ranking of Telecom Namibia, noted that the company was supposed to recover N$20 million.
Even that appears to be a major loss, given the amount of money invested in Angola. This comes after Telecom Namibia was released as the guarantor for the payment of U$2m in September 2012, whereby a consensus was reached to convert the 44,000 ordinary shares into redeemable preference shares.
As Telecom Namibia took 44% shares in the deal, the other 56% of Mundo Startel was owned by private companies and individuals in Angola, namely Mundo Telecommunications, Banco Commercial Angolano, Jembas Technical Assistance Lda, Manuel Joao Carneiro and Nazare de Jesus Fransisco.
The venture was meant to be a free-standing company structure with its own managing director, technical manager and financial manager, who were supposed to be taken from Telecom Namibia and designated to the Angolan operations for a period of five years.
Mundo Startel had to start a network rollout plan in line with the licensing requirements which were meant to cover Luanda and the Lobito province in the first year, and spread through the other provinces to cover the whole country within two years.
The new company was supposed to concentrate on installing next-generation networks, VSAT and wireless digital technology instead of digging ditches and putting up telephone poles, in addition to the deal signifying the first step in Telecom Namibia’s strategic intent to penetrate the Southern African Development Community (SADC) market.
Telecom Namibia gave money as a loan to Mundo Startel SA, and in 2011 they demanded the money back as Telecom Namibia decided to disinvest because of the business conditions in the country.