GIPF may finance MTC buyout

13 March 2018 | Business

The Government Institutions Pension Fund (GIPF) is in the process of conducting due diligence to help the government fund the planned acquisition of mobile service provider MTC.

GIPF spokesperson Daylight Ekandjo said a formal request had been received from the government for the planned acquisition. The GIPF was now conducting an assessment on the viability of the study. “GIPF received a request from government, however, we are in the process of carrying out due diligence to determine if we will invest.

As one of the largest local investors, GIPF is committed to invest in Namibian assets that meet both our regulatory and financial criteria,” said Ekandjo.

According to her, the planned purchase would also ensure that the GIPF complies with pension regulations which require local investment managers to have a minimum of 45% of their total assets under management in local instruments.

“This is in line with proposed changes to allow pension funds to invest a minimum of 45% of their assets in Namibia, which was announced by the finance ministry,” she said.

“At this point, we are unable to determine how long the due diligence process will take as it involves engagement with various stakeholders,” she said.

The Communications Regulatory Authority of Namibia (Cran) also recently gave its blessing for the acquisition of a 34% stake by the government.

One of the conditions is that GIPF should own 20% of MTC, as proposed by Namibia Post and Telecommunications Holdings (NPTH) in its letter last month.

Another condition was that “Mobile Telecommunications Limited must be listed on the Namibia Stock Exchange within a period of 12 months”.

Cran also said 29% of MTC shares should be sold to private and or local investors on the Namibia Stock Exchange.

Former communications minister Tjekero Tweya in December 2016 announced plans by the government to purchase 34% of MTC.

The 34% stake is owned by Samba Luxco SARL, which is incorporated in Luxembourg. MTC is owned and majority-controlled by NPTH.

Cabinet took note of the progress made with regard to the buyback of the 34% foreign-owned shares in MTC. Cabinet endorsed the NPTH decision to obtain confirmation of the legal rights of Samba to act on behalf of Africatel, before the transaction will be negotiated further.

“Cabinet approved NPTH and MTC to devise a strategy to safeguard the future operation of MTC by way of acquiring a technical partner which is not necessarily a shareholder.”

OGONE TLHAGE

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