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MUTAPA Investment Fund (MIF) — the sovereign wealth fund that took over a sprawling network of state firms last year said that it would tackle a USD 399.5 million TelOne legacy debt
MUTAPA Investment Fund (MIF) — the sovereign wealth fund that took over a sprawling network of state firms last year said that it would tackle a USD 399.5 million TelOne legacy debt, to bolster the fixed line telephone operator’s capacity to secure loans. Banks have turned down TelOne’s efforts to raise capital, citing the massive legacy debt, according to chief executive officer Lawrence Nkala.
The firm competes in a dynamic sector with ever-shifting technologies. This requires it to keep pace with technology. Bigger threats have recently emerged from global firms like Starlink, which was recently given the nod to operate in Zimbabwe. TelOne plans to spend about USD 30 million on capital expenditure this year alone.
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It took over the legacy debt when the government unbundled the Posts and Telecommunications Corporation (PTC) over 20 years ago. Lawrence Nkala said that aside from inherited loans from PTC, the balance sheet looked good. Because of the legacy loans, he asserted that it becomes hard for banks to give long-term finance to the telecom company. Therefore, the company, he said, is looking for short-term loans with maturity between 12 months to 24 months.
