Reward Kangai — Telecel Deal Meant to Deceive The Public Whilst Facilitating Proxy Shareholding to Grace Mugabe

Where there’s smoke there’s fire. Though many could now start asking questions why Reward Kangai was quiet all along? With some arguing that he did not feel safe revealing all to the previous G4O run government which Supa was also part of. Recently Reward Kangai revealed that Supa Mandiwanzira engaged a South African firm for consultational services without going to tender as is standard procedure. Kangai as Netone CEO at the time was then shocked to receive an invoice for $4 million which he claims that neither he as CEO or the other board members knew about. Today we have got another story that the Government’s acquisition of Telecel was meant to deceive the public whilst facilitating proxy shareholding to Grace Mugabe.

Former NetOne CEO Reward Kangai has written to the new President Emmerson Mnangagwa appealing for the Telecel deal to be investigated as it was meant to hoodwink the public whilst facilitating shareholding to former First Lady Grace Mugabe and Information Technology Minister Supa Mandiwanzira.

According to Kangai, the government’s purchase of Telecel, a move that was initiated by Mandiwanzira at a time when government already owned 100% shareholding in NetOne and had, over the years, failed to adequately capitalize the company, cannot possibly have been in the interest of Zimbabwe and its citizens.

Kangai is currently making frantic efforts to force corruption investigations against Minister Mandiwanzira by the Zimbabwe Anti-Corruption Commission (ZACC) and has since written to the Prosecutor General. But Mandiwanzira has since dismissed the allegations saying they were coming from a “discredited”, “angry” and “corrupt” former NetOne employee. In a letter dated 27 December 2017 to President Mnangagwa, Kangai said under the POTRAZ Chairmanship of Ozias Bvute, US$10 million of funds from Universal Services Fund (USF) were used as part-payment of 60% share-holding in Telecel. The remaining $30 million came from NSSA.

“NSSA insisted on having a shareholding in Telecel after that payment but Hon. Supa Mandiwanzira is against that, hence NSSA is being reimbursed for its US$30million through the USF,” wrote Kangai. “World-wide, most Governments have been dis-investing from the highly capital-intensive mobile communications business as the industry is very attractive to Foreign Direct Investment (FDI), leaving Governments to focus funding on social services like health and education, which are not so attractive to FDI.”

Kangai added, “It is unlikely that the Minister would have been unaware of the folly of that move but rather, it seems to support speculations that the purchase of Telecel by the Government of Zimbabwe was only an intermediate step with the ultimate goal of benefitting powerful and well-connected individuals.  “There have been wide rumours that the true intention was to later sell Telecel to Unitel, owned by Isabel dos Santos, daughter of former Angolan President, Eduardo dos Santos for a mere US$10million ‘profit’ meant to hoodwink the public whilst facilitating proxy shareholding to former First Lady and the Minister (Mandiwanzira),” claims Kangai.

According to Kangai’s letter, Telecel has suffered a significant drop in both market share and revenue, since its acquisition by government. “Clearly confirming a well-known view of government’s inability to run business, particularly such a highly capital-intensive industry like mobile communications.”

“Should government sell Telecel to a privately owned International mobile operator, NetOne will ultimately flounder as government bureaucracy and corruption continue to weigh down heavily on the company.” The fired NetOne boss added, “The combined revenue of both Government owned mobile operators, is less than 20% market share, whilst Econet rakes in 85% lion share of the market, as shown by the year 2017, 3rd Quarterly statistics recently published by POTRAZ.”

According to Kangai, his former company, NetOne, has registered the lowest Average Revenue Per User (ARPU), “a reflection of the dismal failure of the current management.”

“Yet, the new management under Mr Brian Mutandiro inherited in 2016 a network that had registered an all-time record high number of Greenfield base stations of 148 that were installed in 2015 under the previous management led by the writer. “Revenue for year 2016 under Mr Brian Mutandiro only increased by US$1 million, notwithstanding the high number of base stations installed the previous year and the capital investment of US$218 million made during the previous year under my management,” wrote Kangai.

Mid 2016, it was reported that the government had completed the acquisition of Global Telecom Holdings (GTH)’s entire shareholding in Telecel International for $40 million with the remaining 40 percent being owned by Empowerment Corporation-a group of local investors.