Makamba denies resigning as Telecel chair amid ongoing power struggle

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By Business Day

HARARE: The boardroom squabbles at Telecel Zimbabwe, the country’s third largest mobile operator, took yet another turn on Tuesday when Zimbabwe businessman James Makamba said he “never resigned” as director and chairman of the company last week.

The latest about-turn is likely to see the mobile operator continue on its difficult path, largely sparked by the fight for control.

Telecel, at its peak, was Zimbabwe’s second largest mobile operator, but its continued loss of subscribers and failure to match rivals’ network expansion has seen it slip to third place after market leader Econet Wireless, and second place NetOne.

At the weekend, Makamba was reported by SA’s Sunday Times to be on the verge of losing his lavish Johannesburg, Sandhurst property, Villa Royale, over a $4.5m debt owed to Absa. The debt was raked up by mortagage, credit card and vehicle financing facilities that the businessman has with the bank.

Through his lawyer, Charles Chinyama, Makamba said on Tuesday that there were “factual inaccuracies” to the claims from the extraordinary general meeting, namely that “he had sold” his equity stake in Telecel and “had agreed to step down” as chairman and director.

“Our instructions are that our client has never resigned as director or chairman of the board of directors of Telecel Zimbabwe. Further, that no extraordinary general meeting of Telecel Zimbabwe took place on June 7 2018, and our client denies disposing of any of his Telecel Zimbabwe shares to anyone, neither has he received any consideration in exchange of such purported transaction,” Chinyama said.

“Lastly, our client instructs that, at one stage, he wanted to sell his equity to [a] certain consortium, which failed to fulfil the terms of the conditional purchase and sale agreement, which saw him writing a conditional letter of resignation, which could only have been effective on [the] meeting of conditions in the conditional agreement of sale. The person purporting to have signed the resolution is not the company secretary of Telecel Zimbabwe, neither does the person have authority to act in the manner he did.”

An extraordinary general meeting was held at Telecel on Thursday last week at which it was announced that Makamba’s resignation as director and chairman of the company had been accepted. As part of his exit from the company, he would be paid $11m.

In his place, Gerald Mlotshwa, was appointed chairman with immediate effect. But a back and forth fight between Makamba and Mlotshwa has been raging for the control of Telecel for the past few months. At one time, Makamba claimed to have fired Mlotshwa from being a director at the company.

Calton Consultants, which is the company secretary of Empowerment Corporation of Zimbabwe through which Makamba holds a 40% stake in Telecel, said there had been no changes to the company’s directors. It said the board meeting by Telecel was not “called by us and convened by members”.

Approached for comment, Mlotshwa dismissed Makamba’s claims of not having stepped down and said they were a “desperate” attempt to hold on.