Telecel CEO denied a Zim work permit

Published: 10 December 2013

TELECEL Zimbabwe chief executive John Swaim is alleged to be conducting his duties from a foreign base after failing to obtain a work permit, sources said yesterday.Swaim's application for a work permit was turned down sometime last month, but details of the reasons behind the rejection remain unclear.

However, he is being consulted on most strategic issues concerning the company from a foreign base believed to be Cairo, Egypt.

The company has a local managing director, Angeline Vere, the firm's former legal counsel who briefly led the company as general manager following the unceremonious departure of ex-chief executive Francis Mawindi.

But Swaim was this year reappointed CEO, for the third time, in what observers contend reflects shareholders' unwavering efforts at making sure Telecel Zimbabwe operates in a way that only suits them.

"He did not say the reasons why the Department of Immigration dismissed his application for a work permit," said well placed source.

Efforts to get a comment from Principal Immigration Officer in the Department of Immigration Clemence Masango were not successful yesterday.

Telecel Zimbabwe communications and brand director Obert Mandimika also did not return with an official comment as he had promised.

However, it is widely believed that Swaim could have failed to obtain a new work permit following spirited lobbying from some key shareholders in Empowerment Corporation, a 40 percent shareholder in Telecel.

Sources said the shareholders were not happy about the way foreign imposed executives were running the company. Top of the list of their grievances include alleged disparities between salaries among Telecel Zimbabwe managerial staff with expatriates allegedly earning significantly more than equally skilled indigenous staff.

There are also strong reservations regarding millions of US dollars the company is allegedly paying its Egyptian shareholders in management fees.

According to sources, between $2 million and $3 million is paid to Telecel International after every quarter, as part of the 5 percent management contract they hold. This has raised concern as it is seen as providing comfort to controlling shareholders not to declare dividends.

While its competitors such as Econet Wireless have declared dividends on many occasions, Telecel Zimbabwe has never declared one preferring to reinvest the proceeds into expansion of the mobile phone network.

"They do not want to declare a dividend because they are benefiting from the management contract as they get five percent of the revenue every quarter."

This is also believed to be enabled by a situation where the company's lopsided shareholding of 60-40 percent in favour of the Egyptian shareholder has remained unresolved, giving the latter swaying influence.

Former chief executive Mawindi is strongly believed to have been elbowed out only nine months into his job allegedly over shareholders' misgivings that he was not taking orders after he allegedly questioned their procurement policy.

Sources said the company prefers to award most of its multi-million contracts to Egyptian and Middle Eastern companies linked to its shareholders.

Telecel Zimbabwe is indirectly owned by Russian global telecoms giant Vimpelcom through its parent company Telecel International, an Egyptian registered mobile phone operator, controlled by Global Telecom Holdings, which is a subsidiary of the Russian mobile telecoms firm.
- chronicle