Indian investor Bharti Airtel, which holds 60 per cent shares in Airtel Tanzania, has urged the Tanzanian government to share its findings on the controversial privatisation of the company.
Bharti said the results of the probe will enable it “respond with facts from the records of the company” in a bid to resolve outstanding issues over the ownership.
The government holds that Airtel was owned by state-run Tanzania Telecommunications Company Limited (TTCL) before shares were switched through irregular transfer of shares.
However, in a statement released Saturday, Bharti Airtel said it intends to work closely with the government of Tanzania “…to resolve any doubts or concerns to the satisfaction” of the government and all other stakeholders.
It, however, said it would need support and collaboration from the previous shareholders, directors and officers of MSI to be able to provide any necessary facts and a satisfactory explanation.
“Bharti Airtel, as a major foreign investor in Tanzania, remains committed to the Tanzanian market and will take all steps to protect its businesses, employees, partners, and investments in Airtel Tanzania,” reads part of Bharti Airtel’s in a statement.
On Thursday, Finance and Planning minister Dr Philip Mpango submitted to the government a dossier containing specific findings on the transfer of government shares in Airtel Tanzania from TTCL to MSI Systems International Cellular Investments BV (MSI).
Dr Mpango said the government has opted for negotiations instead of taking the legal route and was happy that Bharti Airtel “has also shown willingness to negotiate.’
The government has claimed that it received peanuts from its investments in the creation of the Airtel Tanzania, then called Celtel that amount to billions of Tanzanian shillings.
It thus wants to reclaim its investment in the mobile telephone network provider.
In its statement, Bharti Airtel claimed the transferring of shares from TTCL to MSI followed due process, was transparent as it had credible witnesses that included representatives from World Bank and the UK and US governments.
Bharti further said the government was paid the full amount of its due in each step of the privatisation process.
In 2001, MSI acquired 35 per cent of TTCL and later, out of that partnership, Celtel Tanzania was subsequently established, Bharti Airtel statement said.
The mobile firm was formed using shareholder loans from the state-run firm, which were later converted into equity, the statement added.
“The government of Tanzania and MSI in 2005 agreed to split the two companies and each (government of Tanzania and MSI ) directly came to own 65 per cent and 35 per cent of TTCL and 65 per cent and 35 per cent of Celtel Tanzania,” the statement noted.
“As each was already a shareholder, there was no valuation or consideration required. At the same time, MSI acquired an additional 25 per cent stake in Celtel Tanzania and paid $28 million to the government of Tanzania,” the statement adds.
As of April 2005, MTC of Kuwait became the ultimate 60 per cent shareholder of Celtel Tanzania (they rebranded the company two years later as Zain), the statement continues to say.
Bharti Airtel acquired that stake in 2010 and in 2015 the government of Tanzania became 100 per cent owner of TTCL by purchasing the remaining 35 per cent,” the statement adds.
“In each instance, the transactions were initiated by the government of Tanzania and conducted with full transparency and all the required approvals and submissions were completed in full compliance,” the statement notes.