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Thursday, August 04, 2005

Econet to contest break up plans with Botsawana

Econet Wireless Group (Econet) has indicated its resolve to contest the plans by its Botsawana subsidiary, Econet Wireless Global otherwise known as AEW Limited.

The firm said though it has not seen the specific papers filed by Altech, “Econet would like to make it clear that the Econet Wireless Group will vigorously contest any attempt to wind up its subsidiary AEW, as we do not consider such a remedy necessary given that Altech invested USD70 million into an existing company in December 2004”, Econet declared.

The Botswana subsidiary is owned by Allied Technologies Group (Altech).

The group said that Altech has advised in the same statement that they are also seeking an alternative remedy for the Botswana High Court to make an order that one of the parties should buy the other out in the joint venture for a sum of USD100 million, about N100 billion.

Confirming this crisis, Econet Wireless Group in a press statement made available to ITrealms said it has received the copy of a statement issued on SENS by the Allied Technologies Group (Altech).

It also confirmed that Altech had made an application in the Botswana High Court for the winding up of a joint venture agreement between Econet Wireless Group and Altech, known as Econet Wireless Global.

But said it is ready to contest this attempt to wind up its subsidiary AEW.

Alternate remedy being sought by Altech was agreed to by the parties on the June 10, 2005, “Once it became clear that the relationship between the parties had broken down irreparably”.
Stressing that this was also the remedy contained in the joint venture agreement between the parties as is normal in business.

Econet said, it has through its financial advisers has already formally submitted an offer to Altech to buy out their stake in AEW while making it abundantly clear to them that Econet has no intention to sell its stake.

“The fact that Altech should seek through the courts a remedy which has already been agreed is consistent with the confusion in their approach that we have observed since they made this investment in our subsidiary AEW,” the group said.

According to Econet Group, the entire approach by Altech in this and other actions which they have taken raises fundamental questions about their real agenda which will no doubt become clearer “to us all as this matter takes its course through the courts in the months and perhaps years to come as we expect a long and protracted battle”.

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