Maravi

Government should have downgraded LAP Green's shareholding in Zamtel to 49 percent - ZICA

COMMENT - The GRZ should have reduced LAP Green's shareholding in an illegal sale? What kind of compromise is that? LAP Green owes the Zambian government about $75 million, which is the net amount the Banda government paid them for the privilege of buying 25% of a company it was selling.

Government should have downgraded LAP Green's shareholding in Zamtel to 49% - ZICA
By Chiwoyu Sinyangwe and Hope Chali

THE government should have downgraded LAP Green Network's shareholding in Zamtel from 75 per cent to 49 per cent as opposed to taking 100 per cent stake which might result in the country using some public money to compensate the Libyan investment vehicle, says ZICA.

And the Zambia Institute of Chartered Accountants (ZICA) says the PF's renewed energy and vigour to fight graft must be appreciated.

ZICA chief executive officer Hapenga Kabeta said "despite the irregularities reported" by the Sebastian Zulu commission of inquiry into the sale of three quarters of the country's total telecommunications provider to LAP GreenN in 2010, the issue could have been handled from the path taken by the government.

"As a country, we should avoid throwing the child with dirty water," Kabeta told journalists during a media briefing at ZICA head office in Lusaka yesterday.

"We believe that LAP GreenN should have been engaged by the government with a view to reach a consensus that would give more benefits to the people of Zambia. Among the alternatives would have been the reduction of shareholding for LAP GreenN from 75 per cent to say, 49 per cent. It is our hope and prayers that the decision by the government to reverse the sale of Zamtel does not prove to be costly to the people of Zambia."

He said the government should have appointed an interim board of directors with a chairperson to appoint an interim chief executive officer.

"We have no problems with the professional standing of the current appointee but the principle used in his appointment was not appropriate," Kabeta said.

"Such appointments are not in line with good corporate governance practices."

On January 24, 2012, President Michael Sata announced that the government had taken back the 75 per cent stake in Zamtel "fraudulently" acquired by Libya's LAP Green Networks in the controversial transaction hatched at US$257 million.

President Sata's announcement saw former managing director Hans Poulsen being replaced by veteran telecommunications engineer Dr Mupanga Mwanakatwe.

President Sata said he deemed it desirable and expedient to compulsorily acquire the 75 per cent shareholding of Lap Green Network in Zamtel after the government having accepted without reservation the report on the findings of the committee investigating the sale of Zamtel.

Earlier in the week, finance minister Alexander Chikwanda said the government would take back the 75 per cent stake in the country's sole total telecommunications provider in a decision made to "restore Zamtel back to the people of Zambia".

Under its previous government, former president Rupiah Banda's influence in abusing and circumventing set government institutions and procedures aided RP Capital to ensure LAP Green Networks bought Zamtel despite not being fit to run the country's biggest telecommunication company.

And Kabeta said the local accountants' body stood ready to partner with the government to fight graft.

"One of areas where government needs to be commended is the fight against corruption," he said.

"There is no doubt that there is renewed energy and vigour in the fight against corruption, which must be appreciated. However, we have observed serious governance issues regarding the dissolution of boards and dismissal of senior management of parastatals and quasi-government institutions in recent past at the behest of those in government."

Kabeta said ZICA feared that the country was heading towards the path where a change of government results into automatic dissolution of boards and senior management.

"This is an effect of destroying peoples' careers and their contribution to the country," said Kabeta.

"Every institution has what we call institutional memory which normally resides in long-standing members of either the board or management continuing to provide services. Our view is that it is important that when changes are made, an objective performance assessment is carried out by a suitably qualified entity or persons, and action is taken after review of the recommendations by an appropriate body, and that the relevant laws are strictly adhered to and contracts are respected."

Labels: LAP GREEN, ZAMTEL, ZICA

posted by MrK @ 10:12 AM