Business Briefs

Masiyiwa buys backs shares from Botswana Power Corporation

THE Competition and Consumer Authority has given Liquid Telecommunications Holdings (LTH) the green light to acquire the 42.5 percent shares currently held by Botswana Power Corporation (BPC) in Liquid Telecom Botswana.

In 2016, Liquid Telecom Holdings entered into a joint agreement with BPC in a venture known as Liquid Telecom Botswana (LTB).

The arrangement was that BPC would lease its excess optical fibres from its network to Liquid Telecom.

BPC acquired the 42.5 percent stake in Liquid Telecom under the Indefeasible Right of Use Agreement (IRUA). Instead of taking rentals, the capital value IRUA was used to buy BPC’s equity stake while Liquid Telecom retained a controlling 57.5 percent stake.

LTB operates as a telecommunications and technology provider, offering products such as wholesale international bandwidth to the fixed-line operator, being Botswana Telecommunications Corporation Limited (BTC), mobile network operators and Internet service providers.

Last month, Liquid Telecom Holdings, whose directors include Zimbabwean businessman, Strive Masiyiwa, alerted the Competition and Consumer Authority of its desire to acquire the shares held by BPC.

After carefully assessing the transaction, Competition and Consumer Authority, Chief Executive Officer, Tebelelo Pule says the assessment revealed the parties do not compete in the same product market.

“LTH operates in the digital and media communications market while BPC operates in the electrical power generation market,” said Pule.

Additionally, she noted that the assessment of the acquisition did not reveal any geographical overlaps because LTH has not yet commenced its core operations in Botswana.

Regarding competitive analysis, Pule says the Authority determined there would be no substantial lessening of competition concerns due to the absence of product and geographical overlaps in the activities of the merging parties.

In deciding on the proposed transaction, the Authority also looked into the issue of public interest. In this regard, Pule said the Authority’s assessment revealed the acquisition is expected to create employment, with the transaction also likely to allow LTB to improve the skills of its employees through leveraging of LTH’s global expertise. – Botswana Voice ■

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