HARARE — An offer by telecommunications magnate Strive Masiyiwa to raise Econet Wireless’s shareholding in Zimbabwe-listed TN Bank to 100% has been approved by the bank’s founder, paving the way for the delisting of the bank on the Zimbabwe Stock Exchange (ZSE).
As part of the deal, Tawanda Nyambirai, the founder of TN Bank and chairman of Econet, would resign from the chairmanship and get a minority shareholding in Econet, which has more than 7-million subscribers in Zimbabwe.
The company — the biggest telecommunications operator in Zimbabwe — has been rapidly expanding its operations. Its tie-up with South Africa’s Cell C to offer a call-home service for Zimbabweans living in South Africa is described as highly successful.
Analysts said the move to buy the remaining stake in the bank — outside of Econet’s initial 45% share — has been in the making since TN Bank was demerged and separately listed earlier this year.
TN Bank is a fast-growing commercial bank enlisted as a "super-agent" for the EcoCash mobile money product that Econet has unveiled and which is similar to M-Pesa in Kenya. Econet, however, has expanded its footprint beyond TN Bank after unveiling CBZ, the biggest commercial bank in Zimbabwe, as a partner amid indications that the product will be introduced by other banks in Zimbabwe.
"Having seen what happened with Trustco (Econet’s former partner in EcoLife mobile life cover), it is not prudent for Econet to roll out a product such as EcoCash with a bank it does not control," said Mr Nyambirai. He would not divulge any details about the deal.
Unconfirmed reports suggested that there has been a fallout between Mr Nyambirai and Mr Masiyiwa.
But Mr Nyambirai maintained that "there is no fallout" between the two businessmen.
As part of the transaction, Mr Nyambirai will step down from the chairmanship of Econet and it has been proposed that James Myers will take over.
Econet injected $20m into TN Bank in a deal that saw the company list on the ZSE in July. Mr Nyambirai said at the time that the move to have Econet acquire a shareholding in a banking institution anticipated "the integration between telecommunications and banking".
An equities analyst said the deal would probably be given the nod by the Competition and Tariff Commission, the Securities Exchange Commission of Zimbabwe, and the Zimbabwean central bank.