Klein leads at Telecom to implement financial fix
Following a balance sheet impairment of over a billion dollars, Theo Klein, Telecom’s new managing director, stated that the major priority for Telecom this year is to find ways for the company to remedy the current financial difficulties they are experiencing.
Klein said that Telecom Namibia’s financial matters have largely been impacted by their investments with Angolan company Mundo Startel and South African company Neotel. According to Klein, Neotel is in the process of being sold to Vodacom and Telecom has had to withdraw their investment with Mundo Startel and is only holding preferential shares in the company. “You will see, in the financial report, that there have been massive losses. […] What we had to do in September 2014 was to [find ways to solve] those investments,” said Klein. He said the company has seen a major fall of over one billion Namibia Dollar in owner’s equity owing to these investments. “That affects our debt-to-equity ratios, which made us lose our fixed credit rating,” said Klein. Telecom is currently discussing contribution matters with the government, its shareholder. “If they can make an equity contribution, then it will lift our equity. It will be the first time ever in Telecom’s history that we will do that. We have run this company entirely with our own funds since inception,” said Klein. According to Klein, the deal between Neotel and Vodacom should go through any time between March and June this year, which should bring some respite to the financially beleaguered communications operator. “[We are] hoping to get a good, considerable amount of money back,” said Klein. With the proceeds from Neotel and the equity contribution from its shareholder, government, Klein hopes to repair the company’s debt equity issues and to have its former fixed credit rating back in the middle of this year.