ECONET Wireless Group (EWG) on Tuesday paid JSE Securities-listed Allied Technologies Group (Altech) US$87,5 million for its 50% stake in Botswana-incorporated Econet
Wireless Global ahead of the payment deadline, which was due at the end of October.
In a statement, Econet group chief executive Strive Masiyiwa said the group had decided to make full payment in advance to enable the business to function normally and to start implementing its expansion programmes.
The early settlement enables Econet to reconstitute its board of directors, an important development as the group has a number of projects which require the full support of a united board and shareholders to be undertaken successfully.
He said Econet Wireless Global would continue to operate as a Botswana-based wholly-owned subsidiary of the group.
“Econet Wireless Group today (Tuesday) completed its payment to Altech for its 50% stake in Econet Wireless Global. Although in terms of the settlement agreement between the parties Econet was only required to come up with a bank guarantee by today and make final payment by the end of October, the company decided to make full payment in advance,” Masiyiwa said.
“This will enable the business to function normally and begin to implement its own expansion programmes. An early settlement also allows us to reconstitute the board and complete some of the projects in the pipeline.
“Now that we have paid Altech, their directors on our board have also resigned and we can now replace them which is important for our corporate governance,” he said.
Masiyiwa said the group would continue with its expansion programme in the telecommunications sector and also with the arbitration process in Nigeria to increase its stake in Vee Mobile, formerly Econet Wireless Nigeria.
Relations between Econet and Altech were last month rocked by a racial slur allegedly uttered by a senior manager from the JSE-listed firm.
The remark led to Masiyiwa walking away from the US$70 million deal.
The two companies last year entered a joint venture which resulted in Altech investing US$70 million in Econet Wireless Global.
Under the deal, Altech seconded Adrian van der Westhuizen as chief operating officer of the joint venture company.
However, the deal suffered when van der Westhuizen allegedly referred to black people as “kaffirs”, a derogatory term Masiyiwa did not take lightly. Van der Westhuizen denies the accusation.