Despite an announcement made more than a year ago that Egypt’s Elsewedy Electric would be the partner for Movicel’s recovery, the investment contract and entry into the telecom operator’s share capital were never signed. Expansão has learned that the Egyptian group, not being a specialist in telecommunications, made its investment — estimated at around USD 400 million at the time — conditional on the possibility of also entering Angola’s electricity sector, its core business.
This had been the major bet of the sector minister to solve the “Movicel problem,” which now appears unlikely to materialize. Representatives of the Egyptian group were even received by the President of the Republic at the time.
After months of advances and setbacks, it has become clear that this will not be the solution, and Movicel’s shareholders have already started negotiations with other interested parties. According to information obtained by Expansão, advanced talks are underway with one European and one African operator, and a decision may be reached in the coming weeks.
Of course, the formal entry of a new operator requires an administrative process that takes some time, but the intention is for it to be completed by the end of the year.
It should be recalled that when the government announced that the Egyptians would be the chosen partner, other interested parties walked away from negotiations. This need to resume talks now leaves the national telecom operator in a more fragile position.
Contrary to previous reports that a new investor would enter through the sale of INSS’s stake, Expansão has learned that the new investor will take a shareholding of between 50.1% and 60%, with the capital to be ceded diluted among all shareholders, particularly the two largest, INSS and Angola Telecom. In other words, the balance among national investors will remain, but now in a minority position.
There is some urgency in closing this deal, as the company’s situation worsens by the day, with deteriorating infrastructure — more than USD 150 million is estimated to be needed to restore the transmission network — store closures, employee departures, and customer losses. Since 2018, Movicel has lost around 2 million subscribers and currently holds just a 2% market share.
Source: Expansão
