Telecel Zimbabwe’s head office in Harare. Telecel, the country’s smallest mobile network operator, has moved to place itself under a formal corporate rescue process effective 27 October 2025. In a board statement, executives said a resolution to that effect has been filed with the Master of the High Court and the Registrar of Companies under Section 122 of the Insolvency Act. The aim is to stabilise and revive the struggling company’s operations through a supervised turnaround effort.
What Is Corporate Rescue?
Corporate rescue is a legal process designed to rehabilitate a financially distressed company. Introduced by Zimbabwe’s 2018 Insolvency Act (which replaced the old judicial management regime), the framework gives troubled firms a breathing space under court supervision rather than pushing them straight into liquidation. Under Section 122 of the Act, a company’s board may voluntarily start rescue proceedings if it has reasonable grounds to believe the firm is insolvent but still has a good chance of recovery. Once in rescue, creditors’ claims are temporarily frozen, and a licensed corporate rescue practitioner is appointed to take over management. This practitioner must restructure the company’s debts and operations and develop a detailed turnaround plan for affected parties to consider.
Telecel’s Financial Struggles
Telecel has been losing ground in Zimbabwe’s mobile market for years. Its subscriber base plunged from about 2.5 million at its 2012 peak to roughly 750,000 by the end of 2020. This decline has continued: official regulator data show Telecel had only 336,559 active subscribers in Q2 2025 (down 5% year-on-year), even as market leaders Econet Wireless and NetOne grew their bases. The company has suffered from years of under-investment and network reliability issues, leaving it far behind the industry leaders in both coverage and market share. With limited cash flow, Telecel struggled to upgrade its infrastructure and compete on service quality. Signs of distress became public in late 2022, when Telecel’s own employees’ union (CAWUZ) petitioned the courts to force a rescue.
The union – which was owed significant back-pay and dues – argued that Telecel’s debts already exceeded its assets, a clear indication of insolvency. CAWUZ maintained that the company’s woes were “not insurmountable” and pointed to the industry’s growth potential as evidence that a structured turnaround could succeed.
Telecel fought the move in court, countering that the union lacked the legal standing to compel the process. While that bid ultimately failed on procedural grounds, it underscored the depth of Telecel’s financial crisis.With the board resolution now filed, Telecel must follow the procedures set out in law. Under Section 122, it has five business days to notify all affected persons (creditors, investors, employees, etc.) of the rescue resolution and its effective date, including a sworn statement of the facts supporting the decision. It must also formally appoint a qualified corporate rescue practitioner within that period. Once appointed, the practitioner will effectively take charge of Telecel, manage its affairs in place of the existing board, and work with management to draft a formal rescue plan.
This plan – detailing debt restructuring, capital injection, and operational changes – will then be circulated to creditors and shareholders, who will vote on whether to approve it at a creditors’ meeting. If the plan is approved, it will guide Telecel’s turnaround; if not, the company could still face liquidation.Telecel’s board emphasised that the rescue process is meant to save the company, not to wind it up.
“The corporate rescue process is designed to rehabilitate the company and does not signify any intention to liquidate,” the operator said in its statement. Company officials expressed confidence that, under professional oversight, Telecel can “restructure its finances, attract investment and modernise its network, ensuring continued service to customers and the preservation of jobs”. Observers will be watching closely to see if this legal intervention can indeed stem Telecel’s decline and secure its future.
