Tanzanian appeal court dismisses application by Sasatel director

Telecoms

Tanzania’s Court of Appeal (CA) has dismissed with costs an application by a director and shareholder of Dovetel, trading as Sasatel Tanzania, over the telco’s alleged mismanagement and financial ‘crisis’ dispute. Justices Engela Kileo, Nathalia Kimaro and Salum Massati rejected the appeal lodged by Dovetel director Mary Bundala and First Seal Company, Dovetel’s majority shareholder, ruling that there was no case to answer against the respondents Ripe Tanzania, Peter Chitamu and Charles Rwechungura, the appointed administrator.

The CA panel adjudged that as all sides were in agreement over the ‘critical financial problems’ and a debt burden that left it unable to pay its creditors, as well as general mismanagement, incompetency and inefficiency, they found ‘no fault or irregularity’ with the original ruling from the trial judge (Judge Agnes Bukuku in April 2013) and, as such, ‘there is nothing for this court to revise’. The plaintiffs’ application was dismissed with costs. Judge Bukuku had ordered that Sasatel Tanzania ‘be valued or shares sold and its conduct regulated through an appointment of an administrator’.

Mobile and broadband start-up Sasatel was founded in 2005 by four shareholders looking to exploit the growing demand for modern communication solutions in Tanzania. In March 2008 PME African Infrastructure Opportunities, an AIM-listed fund investing in infrastructure projects across sub-Saharan Africa, announced the completion of an investment in Sasatel under which PME – through PME Tanco (Mauritius) – agreed to provide the operator with up to USD26 million in financing in order to roll out its networks throughout Tanzania over a two-to-three-year period.

As it stands, First Seal Company is the majority shareholder of Dovetel, after purchasing the shares of PME Tanco (Mauritius). Ripe Tanzania is a minority shareholder. On 14 December 2011, however, a petition was filed in the High Court seeking administrative orders.

Source: Telegeography 14 September 2016