Harare — EGYPTIAN billionaire and Orascom Telecom chairman Naguib Sawiris is to inject a significant amount of cash towards the expansion of Telecel Zimbabwe, which he had in 2007 planned to hive off into an ambitious pan-African group.

Market sources said recent developments, under which Telecel Zimbabwe had dismantled its antiquated base stations and replaced them with modern ones, were part of an ambitious plan for the mobile cellular operator to be seen as a competitor in the domestic mobile phone market, where it has always been perceived as a dark horse.

"They (Orascom) are putting together something that's likely to surprise the market. It's an ambitious project," a source said.

In a recent announcement, Telecel Zimbabwe said it would significantly increase its subscriber base, highlighting a fresh battle for market share in a country where the mobile penetration rate is at 10 percent.

The telecommunications firm said it had dismantled some old base stations and replaced them with high capacity equipment, resulting in the availability of 100 000 new lines.

"We will be targeting selected new geographic sites to extend out geographic coverage to most highway corridors, service centres and rural areas in addition to all major cities, towns, commercial and mining centres. (This) will result in even more lines being released onto the market," the announcement said.

Apparently, Sawiris had planned to structure a deal under which Telecel Zimbabwe, which could easily overtake the state-owned Net*One as the second biggest mobile phone network in terms of subscribers, could become part of a bigger pan African group.

"There are discussions now to create a pan-African player to which we can contribute our (Zimbabwean) assets," Sawiris had said in 2007.

He said he did not want to be in Africa as Orascom, insisting that the continent needed "someone who's patient and it's very long term."

The deal would have marked the second significant offshore transaction involving Telecel Zimbabwe, whose ownership changed hands in 2000 after Orascom bought Telecel International, the beneficiary shareholder in Telecel Zimbabwe.

Orascom bought 80 percent of Telecel International for US$413 million, taking over Telecel International's 11 GSM operations in several African countries including Zimbabwe.

Sawaris' plans then highlighted the mogul's increasing agitation over the local operation's stunted growth due to a foreign currency crisis and a tariff regime that had weighed down operations.

But now, all that has changed, and his recent acquisition of a Namibian mobile operator Cell One in a US$59 million cash deal through a subsidiary, may signify his renewed interest in the region, especially after he was ordered to sell his shares in cellco Egyptian Company for Mobile Services (MobiNil) to France Telecom (FT) by the International Court of Arbitration early this year.

The acquisition had been made under a new strategy Orascom said was targeting licences and mobile operators in small and medium-sized developing countries with high growth potential.

Orascom has said that it plans to use any funds raised by the enforced sale for expansion. The group currently has operations in Pakistan, Algeria, Tunisia, Bangladesh, Zimbabwe and North Korea and it is believed it will scout Africa for possible acquisitions.