BTC Privatisation accelerates after due diligence

Staff Writer
With a due diligence and transaction structure exercise carried out by the World Bank's International Finance Corporation (IFC) now completed, the privatisation of the Botswana Telecommunications Corporation (BTC) is gathering steam.

"This week marked a major milestone with the Botswana Telecommunications Corporation (Transition) Bill (reaching second reading) in Parliament," said the CEO of the Public Enterprises Evaluation and Privatisation Agency (PEEPA), Joshua Galeforolwe, at a press conference last Friday.

 "This bill should provide for the conversion of BTC from a statutory corporation to a public company as well as provide for the allotment of shares for purchase by a Strategic Equity Partner (SEP).

"The privatisation of BTC will see the introduction of a first tier telecommunications company that will allow for increased technological investment, up-dated systems, higher efficiencies and greater access to telecommunications services."

Due diligence was completed in November.
The BTC transaction bill is now expected to go through committee stage and third reading in Parliament this month, to be followed by the submission to Government of the proposed transaction structure and implementation plan in January next year.

Galeforolwe said BTC will begin the search for a Strategic Equity Partner in the first quarter of 2009 before the tendering process may begin, which will be followed by the PPADB's approval of the transaction.

Giving a glimpse of PEEPA's activities during 2008, Galeforolwe said other privatisation ventures by divesture before the organisation included the National Development Bank (NDB) and Air Botswana.

NDB's selected transaction advisors, South Africa's Nedbank, were still carrying out business assessments and due diligence and a

report, to be presented to Government in the third quarter of 2009, was expected in February next year.

NDB will become the first government-owned financial institution to be privatised, breaking the rigid structure in the local financial industry where all institutions are either government- or majority-owned by foreign multinationals.

Galeforolwe added that another privatisation method used by PEEPA was public-private partnerships (PPPs). 'Plot 21', the recently completed modern office block that houses the Office of the Ombudsman located at the corner of Khama Crescent and Queen's Road on the Main Mall in Gaborone, was one such project.

"We are also working on the construction of the main campus of the Botswana International University of Science and Technology (BIUST) in Palapye," said Galeforolwe. "We expect to announce the preferred bidder by October 2009 and the campus to be completed by 2011."

Meanwhile, PEEPA Board Chairman Blackie Marole has said demand for PEEPA's advisory services on privatisation is forecast to increase substantially as the government intensifies its efforts to improve project implementation and service delivery by involving the private sector.

Marole, who is the Managing Director of Debswana, was presenting the PEEPA Annual Report for 2008. 

"Accordingly, PEEPA shall continue to enhance its delivery capacity by engaging the services of private sector advisors while concurrently building its in-house advisory skills and competency base," he said.



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