IN the swirl of commentary about Econet Wireless Zimbabwe (EWZ), Cassava Technologies, and Liquid Intelligent Technologies, a simplistic narrative has taken hold: an African corporate empire is collapsing under debt. But this interpretation conflates capital-market stress with strategic failure. What is unfolding instead is a tension familiar to capital-intensive infrastructure builders worldwide: the mid-cycle strain of ambitious network expansion colliding with a harsher global funding environment.
By Brighton Musonza
Yes, the downgrades from Moody’s and Fitch matter. Liquid’s credit rating now sits deep in speculative territory (Moody’s Caa2; Fitch CCC+), and a heavy refinancing calendar looms, including roughly $131 million due in early 2026 and $620 million later that year. Creditor covenants are strained, debt ratios are tight, liquidity is thin, and interest costs are rising. Failure to refinance or restructure on time could trigger breaches. These are material risks—but they are risks inherent to the business model, not proof of strategic obsolescence.
The group also moved to clarify market speculation around its balance sheet and subsidiaries, stressing that it is not disposing of Africa Data Centres (ADC). Instead, Stanlib’s minority investment in ADC’s South African unit forms part of a broader capital-recycling strategy, with ADC remaining firmly under Cassava’s control.
Management further stated that credit approvals are already in place to refinance the US$131 million facility maturing at the end of February, noting the loan has amortised steadily from US$220 million in 2021 and that the remaining US$141 million was always structured as a bullet repayment, meaning the facility is not in default.
The company added that it has significantly reduced overall debt and now plans to issue a smaller US$300 million bond to replace the existing US$620 million note due in September 2026, with refinancing targeted six months ahead of maturity. It also highlighted strong operating momentum, pointing to record third-quarter performance at Liquid Intelligent Technologies and improved investor confidence, with its bonds rallying to around 93 cents on the dollar, a level aligned with their yield profile given the relatively low 5.5 percent coupon in a higher global interest rate environment for emerging market issuers.
Infrastructure Firms Look Weak Before They Look Strong
Liquid is not a software startup with a quick path to profitability. It is Africa’s largest independent fibre backbone operator, spanning more than 100,000 km across over 20 countries and connecting landlocked economies to subsea cables, data centres, enterprises, banks, and governments.
The economics of network infrastructure are unambiguous: long lead times, heavy upfront capital outlays, and payoffs that arrive only after years of deployment and commercialisation. This is precisely the stage Liquid is in: significant build-out has been completed, but traffic growth and monetisation often lag the physical network. This depresses conventional credit metrics even as the underlying asset base expands.
Global analogues abound. Submarine cables in their laying phase are opaque to near-term profit; mobile tower companies appear highly leveraged before reaching critical mass; hyperscale data centres routinely burn cash until utilisation passes a scale threshold. Today’s weak free cash flow ratios are not evidence of a broken business, but of a mid-build balance sheet under pressure.
To understand Liquid Intelligent Technologies’ current position, it is useful to recall its origins. The business began life as Econet Satellite Services, initially established in London to carry international traffic for Zimbabwe at a time when the country’s global connectivity options were limited and expensive. What started as a single-country gateway evolved over two decades into a multi-jurisdictional digital infrastructure platform.
As regional opportunities opened, the company expanded beyond its Zimbabwean base, investing heavily in terrestrial fibre networks and cross-border links. A pivotal moment came with the acquisition of Neotel in South Africa, which transformed the scale of the business. South Africa’s larger enterprise market, more advanced data economy and higher bandwidth consumption meant that the South African operation eventually outgrew Zimbabwe to become the largest contributor to group revenues.
Yet Zimbabwe has never ceased to matter operationally. While its relative share of revenue has declined as the business diversified, Zimbabwe remains a significant source of traffic volume on Liquid’s network. The company does not merely carry international capacity for Econet Wireless Zimbabwe; it provides wholesale international connectivity for multiple Zimbabwean operators, including NetOne, TelOne and Dandemutande, among others. In practice, Liquid functions as the primary international gateway for Zimbabwe’s telecommunications sector, aggregating traffic across the market.
This structural position reflects geography and timing as much as strategy. Landlocked countries depend heavily on cross-border fibre routes, and early investment in backbone infrastructure often creates durable advantages. Liquid’s established routes and scale economics have made it difficult for alternative international carriers to compete effectively for Zimbabwe-originated traffic. The result is not simply a commercial relationship with one mobile operator, but a systemic role in the country’s external digital connectivity.
That reality also places recent debates in perspective. Whether Econet Wireless Zimbabwe is listed or delisted has no material bearing on the underlying demand for international capacity flowing through Liquid’s network. Data usage continues to rise, enterprises still require cross-border connectivity, and national operators still need access to global internet exchanges and subsea cable systems. Liquid’s role as a carrier of Zimbabwean international traffic is therefore anchored in infrastructure and market structure rather than equity market status.
Rating agencies, in assessing concentration risk, naturally highlight the importance of Zimbabwean traffic within parts of the network. From a credit perspective, that scrutiny is understandable. From an operational standpoint, however, the picture is more nuanced: Zimbabwe is one component of a broader, diversified regional system that now spans eastern, central and southern Africa.
What began as a satellite link for one country has become a continental backbone. That evolution underscores the central theme of the Group’s story: a long-term infrastructure build whose strategic footprint has outpaced the short-term comfort of its balance sheet.
Debt is the Cost of Building a Digital Highway
Liquid’s financing history underlines this pattern. In 2021, the group successfully placed an $840 million combined bond and term-loan facility, oversubscribed fivefold, to refinance and support growth. At the time, lower global interest rates helped compress the cost of capital.
But the capital markets in 2025–26 are different: interest rates are materially higher, emerging-market risk premiums have widened, and investor appetite for speculative-grade infrastructure has cooled. That same $620 million bond, issued at a 5.5% coupon, must now be refinanced in a higher-yield environment—a challenge for any emerging-market operator.
Nor is this problem unique to Liquid. Across Africa, submarine cables, data centre campuses, and satellite backhaul operators are navigating similar recalibrations as global capital tightens.
Equiano (Google), a 15,000 km transatlantic cable system built by Google, connects western Europe with Southern Africa, landing in Nigeria, Togo, Namibia and South Africa. Although now operational and boosting capacity, its construction was delayed and capital-intensive, with emerging-market infrastructure requiring sustained investment even after initial deployment.
Another example is the Medusa Subsea Cable (AFR-IX Telecom), an ambitious 8,700 km project funded in part by the European Commission and aimed at linking Africa’s northwestern markets with Europe has had to navigate complex financing structures and cross-border regulatory environments atypical of simpler domestic builds.
These examples show that even international cable builds, often backed by global tech giants or multinational consortia, must navigate capital intensity, regulatory complexity, and delayed returns in Africa’s fragmented markets.
The Cash-Engine Debate Misses the Strategic Point
Critics who depict Econet Wireless Zimbabwe as a “balance-sheet crutch” overlook deliberate portfolio logic. Mature operations often subsidise early-stage growth units. Zimbabwe’s cash flows are not accidental; they are a strategic anchor that has historically funded pan-African expansion through Liquid and Cassava.
Moody’s notes that when Zimbabwe’s earnings are excluded, Liquid’s regional businesses struggle to cover interest expenses, highlighting the domestic unit’s role as a core stabiliser, not a hidden dependency. This mirrors global telecom groups that leveraged domestic profitability to build international fibre, roaming, and enterprise services.
MTN began as a domestic mobile operator in South Africa and used its revenue strength there to expand into multiple African markets. Today it operates across about 19 countries, with a diversified portfolio that now includes extensive fibre assets (Bayobab fibre infrastructure), enterprise services, fintech and wholesale connectivity, demonstrating how a home-market “cash engine” underpinned broader regional infrastructure investments.
Vodacom, originally a South African mobile operator, leveraged its profitability and scale at home to expand into other African countries, including Tanzania, the Democratic Republic of Congo and Egypt. Its footprint now spans hundreds of millions of customers and, increasingly, enterprise and fibre-based services beyond basic mobile connectivity.
While rooted in India, Airtel used its robust domestic earnings to support aggressive expansion across Africa, building mobile networks, fibre backhaul and enterprise solutions in countries such as Nigeria, Kenya and Uganda. Airtel’s strategy highlights how a profitable home market can be a springboard for capital-intensive regional network roll-outs.
Nigeria’s Globacom similarly leveraged its profitable domestic base to build a wider footprint in West Africa and global roaming arrangements, including extensive wholesale voice and data roaming coverage across many international partners — a clear example of infrastructure build-out funded by strong domestic cash flows.
Delisting is Strategic, Not Secretive
The move to delist EWZ from the Zimbabwe Stock Exchange has been portrayed as a retreat or opacity. In fact, delisting can serve legitimate strategic purposes: shielding the Group from distorted local market pricing, enabling agile capital decision-making, and reducing short-term speculative pressures incompatible with decade-long infrastructure cycles.
EWZ and the broader Econet Group remain subject to lender covenants, audit requirements, and scrutiny from global institutional investors and development finance institutions (DFIs), reflecting confidence in governance frameworks.
AI and Data Centres: Strategic Evolution, Not Sweeteners
Investments in AI infrastructure and data centres, including GPU-as-a-Service platforms, are capital-intensive but integral to the Group’s evolution. Cassava Technologies has catalysed over $150 million in strategic investment from NVIDIA, Google, and other partners, while pursuing asset monetisation, such as Africa Data Centres (ADC), to support Liquid’s deleveraging.
Digital adoption in Africa is still early-stage. Governments are digitising services, financial institutions are modernising platforms, and enterprises are embedding AI into workflows. Infrastructure that combines high-capacity transport with compute and cloud services is poised to capture disproportionate margins as the cycle matures.
Satellite Connectivity: Complementary, Not Substitutive
Low-Earth-Orbit satellites like Starlink have generated talk of disruption. But satellites depend on terrestrial fibre backhaul and cannot replace high-capacity core networks. Fibre remains essential for enterprise connectivity, data centre interconnection, and AI workloads. Satellite and fibre are complementary elements of a hybrid digital ecosystem, not substitutes.
Leadership, Governance, and Strategic Consolidation
Narratives that focus on board appointments or governance critiques miss the systemic nature of the challenge. The Group’s governance structure, coupled with DFI involvement, signals strategic relevance and oversight, even amid scepticism in local commentary.
The picture emerging from EWZ and the Group is one of strategic consolidation at a painful midpoint. The Group is restructuring its capital stack, reducing leverage through asset sales and equity injections, and positioning its balance sheet for the next growth phase.
Institutional Capital Enters Africa’s Data Centre Market
Recent developments highlight the maturation of Africa’s digital infrastructure as an institutional investment class. Stanlib, the asset management arm of Standard Bank Group, is pursuing the acquisition of ADC, the data centre division of Cassava Technologies. The South African Competition Commission has recommended approval, clearing a key regulatory hurdle, with the final decision pending.
If approved, the Samrand Data Centre in Johannesburg will return to the broader Standard Bank ecosystem. This reflects growing appetite among pension funds and insurers for infrastructure-linked assets offering long-term, contract-based revenue streams from cloud providers, telcos, and large enterprises.
Demand fundamentals remain robust. Cloud adoption and AI workloads are driving double-digit growth in data centre capacity across Africa. ADC’s continental footprint, from Southern to West Africa, is integrated with Liquid’s fibre backbone, enabling combined connectivity and compute services.
A Phased, Risk-Calibrated Approach
Stanlib’s proposed acquisition of Africa Data Centres (ADC) is not a one-off transaction but the continuation of an earlier strategic investment that laid the foundation for deeper involvement.
In October 2025, Stanlib Infrastructure Investments and Cassava Technologies formed a formal partnership to inject growth capital into ADC’s South African data-centre campuses, supporting expansion and the development of AI-ready facilities in Johannesburg and Cape Town. That initial equity deployment was intended both to fund build-out and to validate ADC’s commercial model to institutional investors.
For Stanlib, the transaction deepens exposure to stable, infrastructure-linked cash flows; for Cassava, it enables partial monetisation while preserving strategic participation in the broader digital ecosystem.
The South African Competition Commission has concluded that the deal is unlikely to materially harm competition. At the same time, regulatory scrutiny of digital infrastructure is intensifying, reflecting its growing status as critical national infrastructure underpinning financial systems, government services and telecommunications networks.
This staged approach — entry capital first, followed by a larger acquisition later is characteristic of capital-intensive sectors where project economics and execution timelines extend over many years. It also mirrors how institutional investors typically access infrastructure assets: gaining initial exposure to predictable cash flows and strategic operations, then increasing commitments as milestones are met and risks become clearer.
For Stanlib, the phased strategy strengthens exposure to long-term, infrastructure-linked revenues supported by contracts with cloud providers, telecommunications carriers and large enterprises. Data centres, like fibre backbones, generate recurring income streams and are increasingly viewed by pension funds and insurers as inflation-resilient real assets rather than purely technology-driven ventures.
For Cassava, the structure allows partial realisation of value from a capital-heavy business while maintaining a strategic foothold in an ecosystem spanning connectivity, cloud services and AI infrastructure. ADC’s continental footprint of seven hyperscale and edge facilities across Southern, East and West Africa has been built on Cassava’s independent fibre network developed through Liquid Intelligent Technologies, alongside earlier financing arrangements including a R2 billion facility from RMB to accelerate capacity expansion.
The logic of phased investment is visible across Africa’s digital-infrastructure landscape, where operators and investors balance long lead times with prudent risk management. The 2Africa submarine cable, one of the largest subsea systems ever constructed, has been financed by a consortium including Meta Platforms, MTN and Orange, with deployment and commercial activation unfolding over several years in line with network build-out and landing-station readiness.
Similarly, independent data-centre operators such as Teraco Data Environments in South Africa have attracted successive capital injections from global investors, including Digital Realty, illustrating how infrastructure value is unlocked progressively as facilities reach scale. Subsea systems such as Equiano, backed by Google’s multi-year digital-infrastructure programme, have also relied on iterative financing tied to landing milestones and broader connectivity commercialisation across West and Southern Africa.
Together, these examples place the Stanlib–ADC transaction within a well-established pattern: patient, staged capital deployment designed to match the long horizons and resilient cash-flow profiles of core digital infrastructure.
Conclusion: Financial Strain Does Not Signal Strategic Failure
The story of EWZ and the Econet Group is not of a collapsing empire. It is the story of a continental digital infrastructure platform navigating the midpoint between ambition and capital-market realities. Downgrades and refinancing pressures indicate urgency, not irrelevance.
Econet’s backbone, combined with Liquid’s fibre expansion and Cassava/ADC’s compute and data centre growth, positions the Group to capture the next phase of Africa’s digital economy. History suggests that infrastructure groups appear weakest just before balance sheets are reset, operational leverage is unlocked, and network profitability accelerates.
The pending ADC acquisition by Stanlib underscores that Africa’s digital infrastructure is maturing as an institutional-grade asset class, where strategic capital, regional operators, and global technology firms converge to finance the backbone of the continent’s data-driven growth.
Brighton Musonza (MBA), Fellow Chartered Management Institute (FCMI), management practitioner, IIBA Certified Business Analyst (CCBA) and SAP S/4 HANA Technologies Consultant. He can be found at mmusonza@aol.com.
