LAP Green Networks of Libya has bought 75 percent equity shares in Zambia Telecommunications Company Ltd (Zamtel), and all parties have signed binding transaction documents.

LAP Green Networks has committed to pay a total purchase consideration of US$257 million for the 75 percent in Zamtel and an additional US$127 million financing for Zamtel’s existing and new network expansion projects.

As part of the revitalisation of Zamtel, LAP GreenN has committed to a five-year business plan, which would foresee a rapid and sustainable return to growth, underpinned by a major investment in network infrastructure and support systems to modernise the company.

Government would retain 25 percent of Zamtel and would continue to have an active role in the management and direction of Zamtel’s future, retaining two seats on the board out of seven and veto rights on certain key decisions concerning the company.

Government would also retain the right to list some or all of its holding on the Lusaka Stock Exchange in future.

A substantial proportion of the total purchase has been allocated to the settlement of full redundancy packages of Zamtel employees. An independent auditor will oversee the payment of the packages to ensure each employ received the correct amount.

As part of the process, LAP GreenN would retain a proportion of the workforce, sufficient to operate Zamtel in an optimal manner and in line with its five-year business plan.

Commenting on the transaction, Finance and National Planning Minister, Dr. Situmbeko Musokotwane said “the government of Zambia has today paved the way for completing the most significant privatisation in the history of Zambia. We are delighted to have signed an agreement with LAP GreenN, who have both the resources and the track record in the African telecommunications sector to turn Zamtel around and deliver rapid change and tangible Zambia.”

Dr. Musokotwane said the agreement was a major step towards reinvigorating the Zambian telecoms market and ensuring that more people have access to more affordable services, and high-speed access to internet, thus contribute to and benefit from the digital economy.

And ZDA Director General, Mr. Andrew Chipwende said through the Zamtel transaction, ZDA actively employed a process that prepared the asset for privatisation, thus setting an important precedent for the future.

“A significant amount of work has laid the foundation for a rapid turnaround at Zamtel. We are confident that we have found in LAP GreenN the long-term strategic partner who can build on the work already done and transform Zamtel into a company that makes a substantial and critical contribution to the Zambian economy,” Mr. Chipwende said.

Meanwhile, LAP GreenN Managing Director, Mr. Abdulbaset Elazzabi said the announcement of LAP GreenN as a preferred buyer of Zamtel was hugely significant for his company.

“This is the single largest investment that we have made to date,” Mr. Elazzabi said. “Zambia is a key part of our wider strategy to build telecom networks across the African continent, and we are extremely happy to have been selected by the government of Zambia to become their partner in Zamtel.”

He said LAP GreenN would make Zamtel a company that delivered benefits to all Zambian companies, consumers and the people as it had done before in other African markets.

Mr. Elazzabi said LAP GreenN had the experience to turn around Zamtel as it had done in other countries where it operates such as Uganda, Rwanda, Southern Sudan and Cote d’Ivoire.

The agreement will become unconditional at the close transaction at the end June, after which a formal handover by government to LAP GreenN would done and a detailed announcement will be made at that time.