Econet announces deal talks, shares steady

Douglas Mboweni - Econet

HARARE – Shares in Econet Wireless, the country’s biggest telecoms firm, traded steady on Monday after the company announced it had begin negotiations that would have an impact on operations.

In a cautionary, Econet said it was “engaged in discussions and is considering various proposals which if implemented may have material impact on the value of the Company’s shares”. It gave no detail.

In Monday trades, 164,265 Econet shares traded unchanged at $1.20, at a total value of $197,118.

Reports say the cautionary may point a restricting of the group, which is valued at $3.1 billion at Monday’s closing price.

Econet’s cautionary also comes at the expiry of a five-year central bank deadline to sell its stake in wholly-owned Steward Bank. Econet took over the then TN Bank early in 2013, first taking up a 97.96 percent stake before buying the entire shareholding in June that year.

According to bank licence requirements, individual or groups of closely related individuals cannot hold more than 25 percent of a bank. Non-financial entities are restricted to just 10 percent shareholding. Steward Bank recorded a profit before tax of $32.7 million in the year to February this year. The bank has deposits of $348.2 million.