The Securities and Exchange Commission of Zimbabwe has said the planned takeover as well as the recent offer to TN Bank minority shareholders by Econet was fair. In a circular to shareholders last week, TN revealed that Econet Wireless Zimbabwe was offering minority shareholders a share swap or cash buyout deal as the mobile operator moves to make the bank its wholly owned subsidiary.
In an interview, SECZ chief executive Mr Tafadzwa Chinamo said the companies should go ahead with their transaction in a transparent manner to each party.
"As a commission we determine whether the offer is fair or not, but in this case we feel the offered buyout share price is rational," he said. Econet currently holds 45 percent stake in TN Bank.
Under the Zimbabwe Stock Exchange rules, a majority shareholder like Econet can make an offer to minority shareholders to buy them out.
Apart from getting the nod of the Securities Commission, TN shareholders had also approved the take over.
The deal should also get approval from the central bank and the ZSE. Econet is offering TN minority shareholders one Econet share for every 28,79 shares already held or a cash buyout of US$0,1591 for every one TN Bank share already held.
The mobile phone operator in December last year struck a deal with TN founder Mr Tawanda Nyambirai. In the deal Mr Nyambirai agreed to relinquish his stake in exchange for equity in Econet Wireless Global.
Meanwhile, analysts believe TN Bank minority shareholders may cash in if they dispose their stocks to Econet at a premium as the telecommunications firm moves to take over the banking institution and boost its prescribed minimum capital requirements.