Zambia to sell up to 75% telecoms firm Zamtel

Mergers, Acquisitions and Financial Results

Zambia plans to sell up to 75 percent of the telco incumbent Zamtel as part of a push to privatise state assets, the country's development agency said on Tuesday. The Zambia Development Agency (ZDA) said in an advertisement in South African financial daily Business Day that prospective bidders were invited to place bids to qualify for the proposed sale of an equity stake in Zamtel.

A senior Zambian official, speaking on condition of anonymity, said the government would not put a price tag on Zamtel because that might lower the price. The ZDA said up to 75 percent of Zamtel would be offered for sale, while the government would retain a 25 percent stake which it might sell at a later stage through an initial public offering on the Lusaka bourse.

The long-planned privatisation of Zamtel has been criticised by opposition parties who said Zambians should be allowed to hold a bigger stake in the company. Zamtel is Zambia's only licensed fixed-line provider of voice and data communications and revenue for the year to end-December were $100 million, according to the ZDA.

"The government advertised the sale of 20 percent shares in Zamtel in the 1990s but no investor came up. Zamtel requires money to turn around," the source said. The government considered breaking the firm up but the value of individual Zamtel parts would have been less than if it was sold as an entity.