Vodacom tries to resove DRC disputes
He says the company is "making good progress" in talks with both Congolese Wireless Networks (CWN) and Namemco Energy to resolve two disputes that are nearly five years old.
Joosub also tells the Financial Mail that Vodacom "has a bright future in the DRC. In the 2½ months since I've been back [from Vodafone in Spain], I've been engaging with various stakeholders to make sure that this happens," he said.
Resolving both issues would free Vodacom to grow its 51% Congo subsidiary, potentially its biggest market as the population is over 70m. It might also allow Vodacom to increase its stake without having to inject more funds.
"We're following a two-pronged approach. One is looking at the historical matters while the other is looking to the future, to work on shareholder relations and make sure we grow the business," says Joosub of the talks with CWN, 49% owner in the 10-year-old Vodacom Congo. He hopes these two processes will "converge" in future to solve the funding dispute.
Vodacom had to fund investments to get the business off the ground on its own, as CWN was unable to raise its share of the capital, estimated at R5bn now. In 2009 CWN raised a dispute, saying the loan terms were unfair and that Vodacom had abused its seniority in the venture. Both parties asked the International Chamber of Commerce to arbitrate the matter, which happened during October. The parties are awaiting the final outcome.
Joosub says Vodacom is also following a two-pronged approach on a US$40m claim by Namemco Energy, owned by Moto Mabanga In January the Kinshasa commercial court awarded Mabanga's claim, reducing it to US$21m plus interest. Vodacom has appealed against the ruling.
While awaiting a court decision, Vodacom is negotiating with Namemco with a view to settling. Mabanga has confirmed the talks, saying lawyers for both parties were due meet in New York on Monday (19 November).
Alieu Conteh, CWN's chairman and largest shareholder, met Vodacom in Johannesburg on the same day. "Shameel is much more open and eager to resolve the matter," he says.
Source: Financial Mail via I-Net Bridge