Four foreign firms, including an American-funded Lebanese consortium and a South African telecommunications giant, are jostling to acquire between 45% and 50% equity stake in NetOne, in a deal that is expected to turn around the fortunes of the crisis-ridden state-owned mobile network operator (MNO).
According to informed sources, the other suitors are an Abu Dhabi-based firm and grouping of investors domiciled in the Diaspora.
Insiders with details of the deal say the potential investors had showed willingness to clean up NetOne's balance sheet and inject fresh capital into the state-run entity.
"The investor seeks to buy NetOne at a fair price using the conventional valuation comparable. The government of Zimbabwe will be looking to price in a control premium. We envisage that the deal will be able to put an offer that will be acceptable to all parties, based on fair valuation of the business," reads one of the bids under consideration.
In exchange, the Reserve Bank of Zimbabwe will issue the requisite pre-approvals to the investor to allow for the repatriation of invested capital and future dividends from Zimbabwe. NetOne, which is in a precarious financial position, continues to be rocked by corporate governance and corruption issues. Just this week, the company suspended its chief executive, Lazarus Muchenje, in a nasty episode which sucked in the line minister responsible for Information and Communication Technology, Supa Mandiwanzira, for allegedly interfering in the day-to-day operations of the business.
Mandiwanzira has rejected the claims.
Muchenje's predecessor also parted ways with the company in a similarly dramatic incident, where allegations and counter-allegations of corruption were exchanged between him and Mandiwanzira.
NetOne, the smallest of the three licensed MNO's operating in the country by subscribers and revenue, has perennially registered losses despite being the first to launch in Zimbabwe.
Two other MNO's operating in Zimbabwe are Econet, the largest operator by both subscriber numbers and Telecel, a company government has controlling shareholding.
Under former president Robert Mugabe, government blocked several bids from strategic investors looking to take over or partner NetOne.
Another South African firm, MTN, which is not in the running this time around, has had several of its bids to take over NetOne scuttled because of political interference.
In 2010, MTN had its bid shut out after an earlier attempt to acquire a 51% stake of the network for US$30 million in the late 1990s flopped.
In late 1999, Telecel Zimbabwe also had an unsuccessful bid for a merger with NetOne under which it wanted an equity determination based on subscriber numbers.
The bid failed after government insisted that using subscriber numbers would underestimate NetOne's true value because its subscriber base was much lower than the network's full potential.
According to industry insiders, NetOne would require a capital injection of not less than US$400 million for it to be in a position to compete with its peers in the market.
In the year to December 2016, NetOne reported a full year loss of US$2,7 million from a revenue of US$115 million.
The firm has incurred consecutive losses over the years and continues to be dogged by legacy debts most of which are owed to statutory bodies and foreign suppliers such as the Chinese giant Huawei Technologies which supplies equipment to NetOne.
The last capital injection NetOne received was a US$218 million loan from Afreximbank used to fund an upgrade of the company's network.
Unlike its peers, NetOne has a lax credit control system, a situation that has seen amounts owing to the company rising exponentially over the years.