Econet Wireless Zimbabwe Limited (EWZL), subsidiary of Econet Wireless, wishes to acquire stakes in  Liquid Telecommunications Holdings Limited, another subsidiary of Econet Wireless. In a circular sent to its shareholders, the company suggests the purchase be done via shares exchange.

The telecom company offers to exchange the 51% stake, valued at $135 million, it has in Data Control and Systems Limited, which operates under the trade name Liquid Telecommunications Zimbabwe, for stakes in Liquid Telecommunications Holdings Limited (LTZ).

Econet Wireless Zimbabwe also offers to convert 1,166,906,618 debenture bonds it issued into ordinary shares on the basis of  93.3 ordinary shares for 100 debenture bonds.

The trust indenture of the debenture bonds will thus be canceled for holders who would agree for the conversion. They are also guaranteed listing and acceptance of the thus obtained shares.

In addition, Econet Wireless Zimbabwe suggests separation of its mobile network exploitation activities from the technology part. A new company will thus be created. Named Cassava SmarTech Zimbabwe Limited (CSZL), EcoCash, Econet Life, and Steward Bank will be fully transferred to it and 90% of Econet Insurance will fall under its wing freely before free issuance of 2,679,300,700 shares to holders in proportion to their equity. There will also be acceptance and listing of those shares on Zimbabwe Stock Exchange Limited (ZSE), separately from the listed shares of EWZL.

An extraordinary meeting of EWZL’s shareholders is planned for November 29, 2018, to discuss all the suggestions. According to the circular sent to shareholders, the demerger of Cassava SmarTech is aimed at improving the management and capital allocation as well as allowing a targeted implementation of strategies.