Reports coming from Kasapa Telecom Limited (Expresso Ghana) indicate that Sudan Telecom (Sudatel) has announced for the second time the sale of Expresso Ghana is ongoing to a buyer who is yet to take full possession of the company.
Sudatel admitted on page 33 of its 2014 Fourth Quarter Financial Report published only recently on its website that in 2013 it entered into a shares purchase agreement (SPA) with the buyer (name not provided) and the terms of SPA was subsequently modified in May 22, 2014 so the buyer has so far paid $5 million for 18% shares.
It further reported that all the shares, however, continue to remain in the name of Kasapa Telecom Limited “pending the transfer of the remaining (82%) shares upon fulfillment of the conditions set out in the SPA for the remaining shares.”
Sudatel also stated categorically that “At December 31, 2014 the operations of Kasapa Company Limited (Expresso Ghana) have been classified as discontinuing operations and disposal group constituted for the sale.”
Indeed, the report on Kasapa Telecom Limited is clearly labelled “DISCONTINUED OPERATIONS” in the report.
Fourth MD leaves
This information, even though relates to a deal supposed to have been struck way back December, 2013, was only published at a time when the latest appointed Managing Director of Expresso Ghana, Colonel Larry Gbevlo-Lartey has left the company allegedly because he was frustrated about the delay in completing the sale.
Reliable sources at Expresso Ghana intimated that Col. Gbevlo-Lartey left December last year, but before he left, he told the workers he was hired specifically to oversee the sale but since it is hanging he felt he had overstayed his welcome.
Since Sudatel took over Kasapa Telecom in July 2008, almost seven and half years ago, this is the fourth time an MD had left.
It started with Bob Palitz, then Hisham Ayoub before El Amir Ahmed El Amir, and now Col. Gbevlo Lartey.
At the time Sudatel took over, Kasapa was growing in terms of subscriber base and was breaking even on monthly basis on the financial side. But Sudatel could not move money around the world to recapitalize the Ghana operations after the massive rebranding to Expresso.
This was because of global sanctions on Sudan, which are still in force till date.
As a result the company has been collapsing gradually and the staff are reportedly frustrated because their salaries are in arrears and they are oblivious of who the new buyer is and when they will take over, as Sudatel has now tagged Kasapa as a “discontinued operations”.
One frustrated worker retorted “the Sudatel guys are not telling us anything – when you ask them all they say is they are working on things – nothing concrete.” Meanwhile, the company’s long line of creditors, including real estate owners, devices dealers, vendors, utilities suppliers and others have been chasing the company for debts.
The sole CDMA player also continues to lose hold of its stake in the market as customers continue to abandon the network by the day due to bad service.
Recently, recharge card retailers likened Expresso Ghana to the embattled microfinance company DKM, because the retailers said they invested heavily into Expresso products and now it has become bad debts for them because no one is buying those products and Expresso has also refused to take them back and refund their moneys.
Jospong and Subah
As of December 2013, the only company known to have gone into exclusive negotiations with Sudatel for the purchase of a Kasapa Telecom was the Jospong Group’s Subah Infosolutions Limited.
Following the exposition of conflict of interest in Jospong’s attempt to buy Expresso the company came out to admit it wanted to buy Expresso but had pulled out.
That claim was subsequently confirmed by the then Expresso Ghana Managing Director, El Amir Ahmed El Amir in an exclusive letter to this writer.
Later on it emerged, as per a press release on Sudatel’s website, that it had concluded the sale of Expresso Ghana to an unnamed buyer.
But Sudatel later denied that information as well, citing translational error, from Arabic to English, in their own press release.
However, after stating in the 2014 Q4 report that it signed an SPA and took $5million for 18%, it subsequently repeated in the 2015 Q1 report that it has 82% of the company, which suggested that 18% was still being held by the unnamed entity in the process of buying.
Meanwhile, Sudatel has still not told its shareholders who the buyer is and the telecoms regulator in Ghana, National Communications Authority (NCA) has also not been informed of the ongoing sale and who the buyer is.
Experts close to the company have however suggested that between 2014 and now, the SPA would have expired so the sale must have been off. Moreover, Sudatel folk still constitute the Board of the company and Sudatel officials have been frequenting Expresso Ghana doing all kinds of audits.