The Sunday Mail
FOUNDING Telecel shareholder Dr Phillip Chiyangwa is sensationally claiming ownership of a significant stake in the Empowerment Corporation (EC) -which has 40 percent shareholding of Telecel Zimbabwe – through his firm Native Telecoms.
He also insists that the founding conventions of EC make it mandatory for founding shareholders to have the right of first refusal.
The business magnate is also making an undertaking to “buy out any shareholder (local and foreign) in terms of the Articles aforesaid possibly with the assistance of the arbitrator determining the price”.
The claims, which are likely to make the proposed US$20 million acquisition of the stake owned by EC in Telecel by Brainworks even murkier, were made in a letter dated February 6, 2015 to Telecel Zimbabwe and Telecel International.
Through the letter, Dr Chiyangwa – the owner of Native Telecoms – claims that EC was born as an economic vehicle of the Zimbabwe Wealth and Empowerment Council, a grouping of local business interests who wanted to invest in telecommunications.
Founders of EC include Dr James Makamba (Kerstel – 15 percent equity); Dr Phillip Chiyangwa (nine percent); Dr Jane Mutasa (IBWO – nine percent); Dr Chenjerai Hunzvi (ZNWLA – nine percent); a Mr Munyoro (Small-Scale Miners – nine percent); Mr Gary Magadzire (ZFU – nine percent); and Mr Leo Mugabe (10 percent).
It is believed that about 30 percent of the shares in the EC were warehoused and members requested to pay their agreed contributions.
Native Telecoms indicates that in terms of Article 7 as read with Article 5(b) of EC’s Memorandum and Articles of Association, subscribing members could offer other members’ shares in proportion to their shareholding.
Transactions that subsequently took place outside the confines of this legal undertaking are, therefore, considered null and void.
Ironically, Dr Chiyangwa confirms receiving payment from Telecel Zimbabwe for his stake, but declares that this was a violation of the Articles and is therefore a nullity.
“Due to the need to allow Dr Makamba, who seemingly looked more enthusiastic and knowledgeable of the telecoms business, and other colleagues it became increasingly necessary to offer our shares to other subscribing members in proportion to their shareholding in terms of Article 7 as read with Article 5(b) of the Memorandum and Articles of Association of the Empowerment Corporation (Pvt) Ltd.
“No such offer was made to other shareholders, but I can confirm having received payment from Telecel Zimbabwe (which is in contravention of the Articles) and a nullity in toto.
“Native Telecoms in the circumstances is a real shareholder in Empowerment Corporation up to the present day,” reads part of the letter.
Further, Native Telecoms says there are no more than two constituent members of EC who managed to pay for their shareholding, adding that the 30 percent warehoused shares must thus be duly distributed to paid-up shareholders.
It is Dr Chiyangwa’s contention that the shares held by EC cannot be sold as a single bloc.
“The purported sale of Native Telecoms shares (to Telecel) excluded the reserve value of the warehouse shares of 30 percent of which no money was ever raised in selling (and) these remain due and distributable to paid up shareholders of the Empowerment Corporation, therefore fairness demands fair play.
“It has come to light that there were no more than two original participators who actually put money as Native Telecoms in paying for their shares, thus Native Telecoms remain a solid shareholder in Telecel Zimbabwe. In the circumstances, I challenge all shareholders to produce proof of payment for shares . . .
“Any purported sale of shares held by the Empowerment Corporation as one investment vehicle to anybody is a nullity.”
The businessman suggests that the problems rocking EC can only be resolved through a meeting of the founding shareholders, with members willing to sell their shares doing so within the context of the Memorandum of Articles of Association.
Proposals by local private equity investment and advisory firm Brainworks Capital Management to acquire the EC shareholding in Telecel has caused a stir as shareholders fight to ward off the overtures.
Businesswoman Dr Mutasa on February 13, 2015 successfully sought a court interdict to stop an extraordinary general meeting to sanction the sale that was supposed to have been held on February 20, 2015.
High Court judge Justice David Mangota ruled that the meeting could only proceed after the court decided on an urgent application by Dr Mutasa opposing the meeting.
Dr Mutasa, her investment vehicle Selphon, Indigenous Business Women Organisation and Magamba Echimurenga fear that if the meeting proceeds they will suffer serious prejudice.
The rift between Dr Mutasa and Dr Makamba’s company began around 2000 when Kerstel injected Z$16 million to rescue EC from a liquidity crunch.
This, according the company’s constitution, ultimately gave Dr Makamba a controlling stake in te business.
But Dr Mutasa contends there was no shareholder resolution with regards to disposal of Telecel shares.
She is also questioning Mr Patrick Zhuwawo’s position as chief executive officer of EC, a position also being taken by Dr Chiyangwa.
