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Starcomms Shareholders Approve N35 billion Deal With Capcom

By on December 31, 2012

Shareholders of Starcomms Plc, a leading CDMA provider in the country, have approved the acquisition of the company by Capcom Limited.

The approval was given by a special resolution at the company’s Annual General Meeting in Abuja last Friday.

The special resolution passed by the shareholders partly stated, “That the investment agreement dated November 8, 2012 laid before the meeting for the investment by Capcom Limited of the aggregate consideration valued at $210m in the company be and is hereby approved.

“That further to the acceptance by the company of the investment consideration to be provided by Capcom, including a cash sum of $85m and other assets to be contributed by Capcom to Starcomms, the subscription for ordinary shares by Capcom Limited of 662.55 million ordinary shares of 50 kobo each of the authorised share capital of the company at a share price of N50.00 and is hereby approved.”

The interim CEO of Starcomms, Mr. Olusola Oladokun, said the deal was necessitated by evolving trends in the CDMA industry.

According to him,

“Ageing telecoms infrastructure, unsustainable tariff plans forced onto Starcomms due to stiff competition and the inclusion of free value added items across all products lines are the main factors, which have led to margins being eroded, particularly the voice business.

“All of the above have led to severe pressure on cash flow, an inability to fund most of our planned projects and significant constraints in keeping existing revenue generating platforms at the desired maintenance levels.”

Also commenting on the deal, Sir Sonny Nwosu, National Coordinator of Independent Shareholders Association of Nigeria flayed the Nigerian Communications Commission (NCC) for allowing the business to go under and promised the new investors the support of shareholders.

He said: “I praise Capcom for coming otherwise we may not have any company to call our own in the near future. It is still better for us to have a small shareholding in the company with value than have a large one without any value if the company goes under.

I will like to appeal to my colleagues shareholders by conducting the election for restructuring of the Board at the AGM. We must learn from our past mistakes. We want to assure the new investors of our full support just as we will expect them to treat us with respect as stakeholders in the drive to revive the company and transform it into a major player in the telecommunications sector in the near future”, Nwosu added

One Comment

  1. Masi

    December 31, 2012 at 10:31 am

    In view of the Transformation plans to keep your esteemed customers, I also wish to bring to your notice my Interest to be your new CLO in Rivers State. You need a CLO who can bring you big clients, one that has hunger to achieve milestones in marketing the brand to the govt. and the people of Rivers State. @masiobi Tweeter handle