Mergers, Acquisitions and Financial Results

Econet Wireless International (EWI), has applied for an injunction in the United Nations court aimed at stopping South Africa’s Vodacom from taking control of ECONET Wireless Nigeria (EWN). EWI chairman and chief executive, Strive Masiyiwa told BBC World Business report on Monday last week.

Mr Masiyiwa has applied for an injunction in the Nigerian courts to stop the Vodacom deal and has gone to the United Nations Commission on International Trade inthe Hague for arbitration. The UN court got involved after Nigeria’s High Court failed to appoint an arbitration panel within a stipulated 60-day period, the report said.

EWN are seeking an order to declare the board meeting where the Vodacom offer was accepted illegal, and demanded that Vodacom should pay damages, arguing that they induced EWN shareholders to breach their contract with EWI.

"We have basically sued Vodacom for inducement to breach of contract," said Mr Masiyiwa. The chairman had on Monday last week told an analyst meeting that by accepting Vodacom’s offer, the ECONET Nigeria shareholders are reneging on an agreement to let his company increase it stake to 33% through a USD150m equity injection.

"We are a major stakeholders in this business, we built it. It carries our brand name."

Vodacom offered USD230m to take a majority stake in the Econet Wireless Nigeria (considerably more than the sum offered by EWI) and the offer was accepted at a board meeting on behalf of shareholders. The management of EWN has denied that there was any breach of contract and said they expected the Vodacom deal to go through.

(SOURCE Daily Trust)