CEO Joseph Hundah said yesterday that the group is in talks with creditors to rescue its business.
Econet abandoned its attempt to challenge MultiChoice’s DStv in the pay TV market across 12 African countries at the end of last year in favour of a focus on free-to-air TV. However, the company has now appointed Ernst & Young as administrator after failing to make a success of the free TV business due to lack of scale and the high cost of satellite transmission. The group, which is owned by Zimbabwean entrepreneur Strive Masiyiwa, has also been affected by the economic situation in that country, which stopped recognising the US dollar and South African rand as legal tender last month amid a mounting crisis.
In addition to the free TV offering, Kwesé Free Sports, Econet Media in January acquired Asian SVOD player Iflix’s stake in the Kwesé Iflix streaming joint venture.
Kwesé Free TV, a new South African venture backed by Econet Media, received a commercial free-to-air broadcasting licence and radio frequency spectrum licence in March, giving the broadcaster 55% of the third South African digital-terrestrial multiplex frequencies.
The group was expected launch five free-to-air channels in the country, including its free-to-air HD sports service.
The South African operation is 20% owned by Econet, with Royal Bafokeng Holdings owning 45% and Mosong Capital owning 35%.
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