ECONET WIRELESS NIGERIA TO MEET OVER BOARD RIFT
The board of Econet Wireless Nigeria, the country’s second-largest mobile phone provider, met last Friday, and shareholders will meet on Monday, to resolve a takeover feud, a company official said last week.
"There is a board meeting on Friday and an extraordinary general meeting on Monday where things are expected to be wrapped up," the official told Reuters, asking not to be named.
The company’s shareholders have been squabbling over a bid by South Africa’s Vodacom for a majority stake, a move being resisted by Econet Wireless International, foreign partner in the venture, with five percent of its equity. Industry sources said this could signal the end of the crisis, which has pitted Johannesburg-based EWI against the Nigerian company.
EWI went to court in Nigeria last month to prevent the Vodacom bid, arguing it had pre-emptive rights to raise its current five percent equity stake in EWN to 33 percent for a subscription of $150 million. The court is due to give a preliminary ruling on Monday.
Company sources say Vodacom has signified its intention to immediately invest USD150 million and pledged another USD400 million in the near future to take control of the firm or a 50 percent stake plus one share. "Their plan is to grow the business and challenge MTN’s position," the official added.
Econet is currently trailing MTN in the fast-growing Nigerian market. It has just over 700,000 subscribers compared to MTN’s 1.2 million, according to figures from the two companies. Vodacom is Southern Africa’s biggest mobile phone provider, with 8.6 million subscribers. It is closely followed by MTN, with seven million subscribers.