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(NEWZIMBABWE) Econet to spend $300m on network expansion

Econet to spend $300m on network expansion
by
07/05/2010 00:00:00

ECONET Wireless Chief Executive, Douglas Mboweni says the mobile phone operator will spend $300 million this year to expand its voice and data services as it targets more rapid growth. "The bulk of investments will go into expanding our infrastructure for both data and voice," Mboweni told Reuters.

Mboweni said that Econet, which competes with Telecel Zimbabwe and the state-owned NetOne, will fund the improvements through a combination of loans, internal cash and vendor financing.

The company will also continue to add subscribers, as Zimbabwe's mobile penetration remains low at about 40 percent, Mboweni added. Econet currently has 4 million subscribers, or 73 percent of the market, up from 1.2 million last year.

"We believe that for as long as the penetration in Zimbabwe is below that of our regional peers, there is plenty of opportunity to get a healthy return from further investment," Mboweni said, adding that Econet had no immediate plans to seek foreign shareholding.

The introduction of multi-currencies in 2009 has helped Econet's operations and the company has grown to become the biggest counter on the Zimbabwe Stock Exchange (ZSE) by market capitalisation.

Zimbabwe's economy grew for the first time in a decade last year but businesses still struggle to access credit from overseas. Econet, however, was able to secure foreign financing through its South Africa-based parent company, Econet Wireless Group (EWG).

The company's earnings before interest, taxation, depreciation and armotisation (EBITDA) for the year ending February 2010 stood at $179 million.

Revenues jumped to $362.7 million, up from $87.9 million the previous year.

Labels: DOUGLAS MBOWENI, ECONET, ICT

posted by MrK @ 11:24 PM