Econet delisting draws scrutiny as investors weigh payout terms

Strive Masiyiwa’s Econet Wireless Zimbabwe has set off a fresh round of debate in the country’s markets after unveiling plans to delist from the Zimbabwe Stock Exchange and spin out a new infrastructure business that is being pitched at about $1 billion.

The proposal, framed by Econet as a value unlocking move, has landed with force among investors who have long complained that local currency volatility and thin trading distort share prices. It has also drawn early scrutiny from market watchers, including analyst Tinashe Mukogo, who says shareholders should not let a headline valuation do the thinking for them.

Mukogo, who tracks corporate actions closely, laid out his concerns in a post on X that quickly circulated among brokers and retail investor groups. He argued that the structure could prove positive over time, but only if shareholders understand what they are getting, how the new shares will trade, and whether the implied value can realistically be realised.

Econet has told shareholders it wants to exit the ZSE and move to an over the counter platform linked to the Victoria Falls Stock Exchange framework, while listing a separate entity, Econet InfraCo, on the VFEX by introduction. A listing by introduction means InfraCo would not raise fresh capital at the start. Instead, shares would be distributed to existing Econet shareholders as part of the reorganisation and exit offer.

Under the structure described in shareholder materials and summaries circulating in local business media, InfraCo is expected to house towers, energy assets and property, while the operating telecoms business remains outside that listing. The transaction is described as carrying a combined implied valuation of roughly $1.52 billion, including a valuation for the operating business and a separate valuation for InfraCo attributed to an independent adviser.

Minority shareholders have been presented with an exit package valued at $0.50 per share, combining $0.17 in cash and $0.33 in InfraCo shares, based on the numbers presented. In practical terms, that makes the bulk of the value dependent on how the market ultimately prices InfraCo once it begins trading and how easily shareholders can sell those shares if they want cash.

Mukogo’s warning focuses on that dependency. A valuation attached to a transaction can feel definitive, he argued, but investors should separate a deal number from an achievable exit value, especially in a market where liquidity can be thin and price discovery can be uneven. The issue is not whether towers and infrastructure have value. It is whether the terms and the trading venue allow that value to be turned into money in a reasonable time.

Econet has framed the restructuring as part of a broader shift in telecoms, where operators separate capital intensive infrastructure from service businesses. Similar moves across Africa have helped tower assets attract steadier investor interest than mobile operations, which are more exposed to currency risk, regulation and fierce competition. Supporters of the plan say a US dollar based venue like the VFEX could attract a different class of investor and reduce the distortions that come with local currency swings.

The proposal also carries implications beyond Econet. A $1 billion infrastructure listing would be among the biggest events associated with the VFEX and could deepen activity on an exchange that has spent years trying to build credibility as a hard currency alternative.

Econet’s plan remains conditional on shareholder approval at an extraordinary general meeting scheduled for Feb. 26, with the InfraCo listing targeted for late March, subject to regulatory clearance. Reports around the transaction have noted voting rules that can increase the influence of minority investors on certain elements, a detail that will matter if shareholder sentiment hardens.

The tension at the heart of the deal is easy to see. Many shareholders like the idea of holding a stake in infrastructure assets with dollar linked revenues, particularly towers that can host multiple tenants. At the same time, a delisting changes the way investors can trade the shares they hold today, and the package on offer places significant weight on a future market price that no one can guarantee.

Executives have argued the plan is about unlocking value the local market has not recognised, while creating clearer structures for two different businesses. Mukogo is not dismissing that goal. His message is that shareholders should test the assumptions, especially around valuation, liquidity and the practical path from a paper number to cash in hand.

Shareholders will have the final say later this month, and the vote is likely to be shaped as much by trust and timing as by spreadsheets. Econet is asking investors to buy into a new architecture for how the company is owned and valued, and voices like Mukogo’s are insisting that architecture should be stress tested before anyone signs.