Zambia’s gov’t rubbishes claims it will sell Zamtel
Zambia’s government has refuted media reports that it has decided to sell financially embattled Zamtel.
The country’s Vice-President Mutale Nalumango said: “Government has not discussed the sale of Zamtel as being reported in some sections of society. Zamtel will be recapitalised and not sold. Zamtel in a competitive industry and so recapitalising would enable it to compete favourably in the market.”
She added that the government is offering the company an opportunity to find a solution to save itself.
Science and Technology Minister Felix Mutati said a working committee will investigate the viability of the company and recommend the way forward, and that currently no equity partner has been identified.
He said, “There will be a lot of information required and a lot of interrogation. There will be nothing personal… what we should all know is that at the end of the day, we want to save Zamtel and that is our only objective.”
In June Mutati said Zamtel has a working capital deficit of around ZMK1-billion and could not support maintenance of current infrastructure, expansion and modernisation.
He added that the company needs recapitalisation of at least US$265-million to stay afloat, but the government could not give the company the money.
In 2010, the country’s previous administration sold the company to Libya’s LapGreen Networks for US$252-million after failing to recapitalise it.
However, the new administration disputed the sale and claimed that the previous administration did not follow normal tender procedures and therefore the transaction was illegal.
The new administration then forcibly took over Zamtel’s operations after insisting that the 75% shares owned by LapGreen Networks were “corruptly sold” by the previous administration.