Notice of an Extraordinary General Meeting

This Document is not and, does not purport to be a Prospectus or an offer to sell, or the solicitation of an offer to buy shares in Zimbabwe or in any country other than Zimbabwe. The distribution of this Document outside Zimbabwe may constitute a violation of the laws of other countries. This Document contains an offer to the existing shareholders of Econet Wireless Zimbabwe Limited to purchase additional shares in Econet Wireless Zimbabwe Limited that shall in all respects rank pari passu with, and be uniform to shares already in issue. The terms and conditions of the proposed Rights Offer and the Debentures are set out herein.

No person has been authorised to give any information, or make any representations in connection with the Rights Offer, or the Company other than as contained in this Document and, if given or made, such information or representation must not be relied upon as having been authorised by the Company, its Directors, or its advisors. The Advisors are acting as advisors to the Company only, in connection with the Rights Offer, and will not be responsible to any other person for providing the protection offered to their clients.

If you are in any doubt as to the action you should take, you should immediately seek advice from your stockbroker, bank manager, legal practitioner, accountant or other professional advisor. If you no longer hold any shares in Econet Wireless Zimbabwe Limited, you should send this Document and the accompanying proxy form as soon as possible to the stockbroker or other agent through whom the sale or disposal of your shares was eﬀected for onward transmission to the purchaser or transferee.

(Incorporated in Zimbabwe on 4 August 1998 under Company registration number 7548/98) ZSE alpha code: ECO ISIN: ZW 000 901 212 2 CIRCULAR TO SHAREHOLDERS OF ECONET WIRELESS ZIMBABWE LIMITED regarding approvals for: The proposed Capital Raise of US$130 Million (the Capital raise) by Econet Wireless Zimbabwe Limited through an offer to members of the Company, pro rata to their respective existing shareholdings, of 1,082,088,944 Ordinary Shares plus 263,050,614 Class A Shares at a subscription price of 5.00 US Cents per share, on the basis of circa 82 ordinary shares for every 100 shares already held. Each Rights Offer share shall be linked to a redeemable accrual Debenture with a subscription price of 4.665 US Cents at a coupon rate of 5% per annum. The amount due on both the shares and the Linked Debentures shall be payable in full on acceptance of the offer. This Circular Incorporates THE NOTICE CONVENING AN EXTRAORDINARY GENERAL MEETING (“EGM”) TO APPROVE THE CAPITAL RAISE

NOTICE OF AN EXTRAORDINARY GENERAL MEETING The Notice of an Extraordinary General Meeting of the shareholders of Econet Wireless Zimbabwe Limited to be held at 10:00 am on Friday 3 February 2017 at Econet Park, 2 Old Mutare Road, Msasa, Harare is set out at the end of this document. Shareholders are asked to complete and return the enclosed proxy form in accordance with the instructions printed thereon as soon as possible, but in any event so as to be received by no later than 10:00 am on Wednesday 1 February 2017.

Shareholders will ﬁnd as part of this Circular a Form of Proxy for use at the Extraordinary General Meeting of the Econet Wireless Zimbabwe Limited’s shareholders. To be valid, a Form of Proxy and any authority under which it is executed, or a copy of the authority certiﬁcate notarially executed or in some other way approved by Econet Wireless Zimbabwe Limited Directors, must be completed and returned in accordance with the instructions printed thereon by post or (during normal business hours only) by hand to the Group Company Secretary of Econet Wireless Zimbabwe Limited or the Transfer Secretaries, but in any event so as to arrive not less than forty-eight (48) hours before the time for the Extraordinary General Meeting or adjourned meeting at which the person named in the instrument proposes to vote. When you do not wish to attend in person, please complete and return the Form of Proxy which is part of this document. The completion and return of the Form of Proxy will not prevent you from attending and voting at the meeting or any adjournment thereof, in person if you wish to do so.

Lead-Financial Advisors

Co-Financial Advisors Sponsoring Broker Transfer Secretaries Reporting Accountants Receiving Bank and Auditors

Independent Financial Legal Advisors Exchange Control Debenture Underwriter Advisors Advisor Trustees

Econet Global Limited

DATE OF ISSUE: TUESDAY 17 JANUARY 2017 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY CORPORATE INFORMATION

Directors Dr James Myers (Non – Executive Chairman) Mr Strive Masiyiwa (Executive Director) Mr Craig Fitzgerald (Non- Executive Director) Mrs Tracy Mpofu (Non – Executive Director) Ms Beatrice Mtetwa (Non – Executive Director) Mrs Sherree Shereni (Independent Non – Executive Director) Mr Godfrey Gomwe (Independent Non – Executive Director) Mr Martin Edge (Independent Non – Executive Director) Mr Douglas Mboweni (Executive Director – Chief Executive Oﬃcer) Mr Roy Chimanikire (Executive Director – Finance Director) Mr Krison Chirairo (Executive Director) The Group Company Secretary and Registered Oﬃce Charles. A Banda Econet Wireless Zimbabwe Limited 2 Old Mutare road Harare, Zimbabwe

Lead- Financial Advisors TN Financial Services (Pvt) Limited 10 Brighton Road Avondale Harare, Zimbabwe

Co- Financial Advisors MBCA Bank Limited 14th Floor, Old Mutual Centre Cnr 3rd Street/Jason Moyo Avenue Harare, Zimbabwe

Independent Financial Advisor Ernst & Young Associates (Private) Limited 1st Floor Angwa City, Kwame Nkrumah/Julius Nyerere Harare, Zimbabwe

Sponsoring Brokers Bethel Equities (Private) Limited 23 Boundary Road Eastlea Harare, Zimbabwe

Transfer Secretaries First Transfer Secretaries (Private) Limited 1 Armagh Avenue, Eastlea Harare, Zimbabwe

Reporting Accountants and Auditors Deloitte & Touche West Block Borrowdale Oﬃce Park, Borrowdale Road Harare,Zimbabwe

Legal Advisors Mhishi Legal Practice 9th Floor Old Mutual Centre Cnr Jason Moyo Avenue/3rd Street Harare, Zimbabwe

Exchange Control Advisor Steward Bank Limited 2nd Floor, 101 Union Avenue Building, Kwame Nkrumah Avenue, Harare, Zimbabwe

Receiving Bankers African Export-Import Bank 72 (B) El-Maahad El-Eshteraky Street – Heliopolis, Cairo 11341, Egypt.

Underwriter Econet Global Limited Anslow Oﬃce Park 8 Anslow Lane, Bryanston Econet Global Limited South Africa

Debenture Trustees CBZ Bank Headquarters 3rd Floor, Union House, 60 Kwame Nkrumah, Harare, Zimbabwe

HELP LINE If you have any questions relating to this Circular or the completion of the Form of Proxy, please telephone the Group Company Secretary, Mr. C.A. Banda on Tel: +263 772555144 or Transfer Secretaries, First Transfer Secretaries on 04-782869/72. i ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY TABLE OF CONTENTS

CORPORATE INFORMATION i TABLE OF CONTENTS 1 DEFINITIONS 2 ACTION REQUIRED BY SHAREHOLDERS 4 IMPORTANT DATES AND TIMES 5 PART I: SALIENT FEATURES OF THE RIGHTS OFFER 6 PART II: CHAIRMAN’S LETTER 8 2.1 Introduction 8 2.2 Purpose of this Circular 8 2.3 The Proposed Capital Raise 8 2.4 Mechanics of the Capital Raise 10 2.5 Application of Proceeds of the Capital Raise 11 2.6 Expenses of the Capital Raise 11 2.7 Conditions Precedent 11 2.8 Underwriting 11 2.9 Related Party Statement 11 2.10 Listing on the ZSE 12 2.11 Effects of the Rights Offer 12 2.12 Rights Attaching to Shares And Debentures 12 2.13 Options and Preferential Rights in Respect of the Rights Offer Shares 13 2.14 Repayment, Redemption and Purchase of Debentures 13 2.15 Consequences of Not Raising Additional Capital 13 2.16 Prospects 13 2.17 Documents Available For Inspection 13 2.18 Experts and Other Consents 14 2.19 Opinions and Voting Recommendations 14 PART III: TERMS AND CONDITIONS OF THE RIGHTS OFFER 15 3.1 Terms of the Rights Offer 15 3.2 Date of Opening and Closing of Rights Offer 15 3.3 Courses of Action 15 3.4 Acceptance - Subcribe for all Rights Offer Shares 15 3.5 Splitting 15 3.6 Renunciation – Elect not to follow rights 15 3.7 Payment 15 3.8 Exchange Control 15 3.9 Dividends 15 3.10 Fractional Rights 16 3.11 Listing and Registration of Rights Offer Shares 16 3.12 Rights Offer Share Certificates 16 PART IV: TERMS AND CONDITIONS OF THE DEBENTURES 17 PART V: SUMMARY INFORMATION ON ECONET WIRELESS ZIMBABWE LIMITED 18 5.1 History 18 5.2 Business Structure 18 5.3 Historical Financial Information of Econet 19 5.4 Performance Review 19 5.5 Shareholders 20 5.6 Corporate Governance 20 5.7 Directorate 21 5.8 Statement of Indebtedness 23 5.9 Litigation 23 5.10 Significant Contracts 23 5.11 Material Changes 24 5.12 Directors’ Interests in Shares 24 5.13 Directors’ Interests in the Rights Offer 24 5.14 Directors’ Interests – Other 24 PART VI: INDEPENDENT FINANCIAL ADVISORS’ REPORT 25 PART VII: ACCOUNTANTS’ REPORT ON THE HISTORICAL FINANCIAL INFORMATION 29 PART VIII: HISTORICAL FINANCIAL INFORMATION OF ECONET WIRELESS ZIMBABWE LIMITED 34 PART IX: REPORTING ACCOUNTANTS’ REPORT ON THE UNAUDITED PRO-FORMA FINANCIAL INFORMATION 40 PART X: ECONET WIRELESS ZIMBABWE LIMITED PRO-FORMA STATEMENT OF FINANCIAL POSITION 41 PART XI: TABLE OF ENTITLEMENT FOR ECONET WIRELESS ZIMBABWE LIMITED SHAREHOLDERS 42 PART XII: SHARE PRICE INFORMATION 43 PART XIII: DETAILS OF THE UNDERWRITER 44 PART XIV: ECONET WIRELESS ZIMBABWE’S ACCOUNTING POLICIES 45 PART XV: DIRECTORS’ RESPONSIBILITY STATEMENT 75 ANNEXURE A: NOTICE OF EXTRAORDINARY GENERAL MEETING 76 ANNEXURE B: PROXY FORM – EGM 77 ANNEXURE C: LETTER OF ALLOCATION 79

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 1 DEFINITIONS

In this circular, unless otherwise indicated, the words or phrases shown below bear the meanings ascribed to them. Words importing natural persons shall include juristic persons (whether corporate or unincorporated and vice versa) and words in the masculine shall import both the feminine and neuter.

“AFREXIM Bank” African Export–Import Bank, a multi-lateral financial institution headquartered in Egypt that has been nominated as designated receiving bank for Econet Wireless Zimbabwe Limited for the rights issue proceeds; “Articles of Association” The Articles of Association of Econet Wireless Zimbabwe Limited; “Board”, “Board of Directors” or “Directors The Board of Directors of Econet Wireless Zimbabwe Limited; “Broker” A Company registered as a broking member (equities) by the ZSE; “Certificated shares” Shares which have not been dematerialised, title to which is represented by documents of title; “CSD” Central securities’ depository, an electronic platform for dematerialised shares, operated by Chengetedzai Depository Company; “CDC” Chengetedzai Depository Company, a licensed entity to operate central securities depository; “Class A shares” Class A shares with a nominal value of US$0.001 each in the share capital of Econet Wireless, each of which ranks pari passu in every respect with the Ordinary Shares except that the Class A Shares are not traded on the Zimbabwe Stock Exchange; “Closing Date” The date on which the Rights Offer closes, being Friday 10 March 2017; “Companies Act” The Companies Act [Chapter 24:03] of Zimbabwe, as amended; “Conditions Precedent” The conditions precedent to the Rights Offer set out in section 2.7 of the Chairman’s letter in this Circular; “Debentures” A Debenture is a debt instrument issued out of the stock of the Company in terms of section 106 of the Companies Act (Chapter 24:03) that is not secured by physical assets or collateral but is backed only by the general creditworthiness and reputation of the issuer. Redeemable, Debentures with an issue price of 4.665 US Cents each, and a coupon rate of 5% per annum payable upon redemption. The redemption value inclusive of the interest coupon shall be of 6.252 US Cents each to be issued by Econet Wireless, each of which shall be linked to a single Share in Econet Wireless to be issued pursuant to the Rights Offer and to be immediately delinked from the Rights Offer Shares upon closure of the Rights Offer; “Debenture trust deed” or “the deed” The Debenture trust deed to be entered into between Econet Wireless and the Trustees for Debenture holders recording the terms and conditions of the Debentures; “Dematerialisation” The process by which certificated shares are converted to or held in an electronic form as uncertificated securities and recorded in the sub-register of security holders maintained by the central securities depository; “Dematerialised shares” Shares which have been dematerialised; “Documents of title” Share certificates, certified transfer deeds, balance receipts or any other documents of title to certificated shares acceptable to Econet Wireless; “Econet Wireless” or “the Company” Econet Wireless Zimbabwe Limited is Zimbabwe's largest provider of telecommunications services, providing solutions in mobile and fixed wireless telephone, public payphones, internet access and payment solutions. The Company is listed on the ZSE under alpha code ECO and ISIN ZW 000 901 212 2; “Econet Wireless Debenture holders” or The registered holders of Econet Wireless Debentures to be issued pursuant to the Rights “Debenture holders” Offer; “EGM” The Extraordinary General Meeting of the Company which shall be held at 10:00 am on Friday 3 February 2017 at Econet Park, 2 Old Mutare Road, Msasa, Harare to approve the resolutions shown in the Notice of the meeting and to give effect to the Rights Issue and Debenture Issue;

2 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY “EPS” Earnings Per Share; “Form of Proxy”, or “Proxy Form” The form, included in this circular, which enables Econet Wireless Zimbabwe Limited Shareholders to appoint a proxy to attend and vote on their behalf and on the Resolutions; “HEPS” Headline Earnings Per Share; “Last Practicable Date” 30 November 2016, being the date before the issue of this circular that was used for purposes of determining the Rights Offer price; “Letter of Allocation”, or “LA” The letter of allocation that sets out the entitlement of the shareholder to whom this circular is addressed with respect to the Rights Offer; “NAV” Net Asset Value; “NTAV” Net Tangible Asset Value; “Opening Date” The date the Rights Offer opens, being Monday 20 February 2017; “Ordinary Shares” The ordinary shares of Econet Wireless Zimbabwe Limited with a nominal value of US$0.001 each in the share capital of Econet Wireless Zimbabwe Limited; “Record Date” The date on which the Econet Wireless Zimbabwe Limited share register was closed for purposes of determining the eligibility of Shareholders to participate in the Rights Offer which date was the close of business on Friday 17 February 2017; “Rights Offer Shares” The approximately 1,345,139,558 Econet Wireless Zimbabwe Limited Shares (comprising of 1,082,088,944 Ordinary Shares and 263,050,614 Class A Shares), each of which shall be linked to a Debenture, to be offered by Econet Wireless Zimbabwe Limited to Econet Wireless Zimbabwe Limited’s shareholders registered as such on the Record Date in terms of Rights Offer and at an offer price of 5 US Cents per share; “Rights Offer” The offer of the Rights Offer Shares described in this circular; “Shareholder” or “Econet Wireless Zimbabwe A holder of Econet Wireless Zimbabwe Limited Shares registered in the Econet Wireless Limited Shareholder” Zimbabwe Limited share register as at the Record Date; “Sponsoring broker” Sponsoring broker on the proposed Rights Offer, namely Bethel Equities (Private) Limited; “Subscription Price” The amount of 5 US Cents per Rights Offer Share and 4.665 US Cents per Debenture payable at the same time, in full, into the designated account outside Zimbabwe, in USD, on acceptance; “The circular” This circular, dated Tuesday 17 January 2017; “TNFS” TN Financial Services (Private) Limited, a Company incorporated in Zimbabwe under registration 5548/97 and that is duly registered with the Zimbabwe Securities Exchange Commission to conduct financial advisory services; “Transfer Secretaries” or “FTS”) Transfer Secretaries to Econet Wireless Zimbabwe Limited, namely first Transfer Secretaries (Private) Limited; “USD” or “US$” The United States Dollar, the lawful currency of the United States of America, being a legal currency in Zimbabwe as well; “Zimbabwe” The Republic of Zimbabwe; “ZSE” Zimbabwe Stock Exchange;

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 3 ACTION REQUIRED BY SHAREHOLDERS

The deﬁnitions and interpretations set out on pages 2 to 3 of this circular apply to this section.

Please take careful note of the following provisions regarding the action required to be taken by shareholders. If you are in any doubt as to what action to take, consult your broker, lawyer, banker or other professional advisor immediately.

ACTION TO BE TAKEN BY SHAREHOLDERS REGARDING THE EXTRAORDINARY GENERAL MEETING An EGM of shareholders will be held at 10:00 Hours on Friday 3 February 2017, at the registered office of the Company to consider and, if deemed fit, pass the resolutions required to implement the Rights Offer. A Notice convening the extraordinary general meeting is attached to and forms part of this circular.

Please take careful note of the following provisions relating to the actions required to be taken by shareholders regarding the EGM:

1 If you have not dematerialised your shares

1.1 Voting and attendance at the EGM • You may attend the EGM in person and may vote at the EGM. • Alternatively, you may appoint a proxy to represent you at the EGM by completing the attached form of proxy (Annexure B) in accordance with the instructions it contains and return it to the Group Company Secretary or the Transfer Secretaries to be received by no later than 10:00 am on Wednesday 1 February 2017.

2 If you have dematerialised your shares

2.1 Voting at the EGM • Your broker or custodian should contact you to ascertain how you wish to cast your vote at the EGM and thereafter to cast your vote in accordance with your instructions. • If you have not been contacted by your broker or custodian, it is advisable for you to contact your broker or custodian and furnish them with your voting instructions. • If your broker or custodian does not obtain voting instructions from you, they will be obliged to vote in accordance with the instructions contained in the custody agreement concluded between you and your broker or custodian. • You must NOT complete the attached form of proxy (Annexure B).

2.2 Attendance and representation at the EGM In accordance with the mandate between you and your broker or custodian, you must advise your broker or custodian if you wish to attend the EGM and your broker or custodian will issue the necessary letter of representation to you to attend the EGM.

If you wish to dematerialise your shares, please contact your broker.

If you have disposed of all of your shares, this circular should be handed to the purchaser of such shares or broker, banker or other agent who disposed of your shares for you.

Additional copies of this circular, printed in English, will be made available at the Company’s registered oﬃce.

4 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY IMPORTANT DATES AND TIMES

Event Date Press Announcement in the form of an Abridged version of the Rights Offer Circular Tuesday 17 January 2017 incorporating the EGM notice and the Rights Offer time table Rights Offer Circular posted to shareholders Friday 20 January 2017 Last day for receipt of proxies for the general meeting by 10:00 am Wednesday 1 February 2017 EGM to be held at 10:00am. The Rights Offer to be approved by members subject to Friday 3 February 2017 Exchange Control Approval. Submission of EGM Shareholder Approvals as directed by Exchange Control for purposes of Monday 6 February 2017 obtaining final Exchange Control Approval Last day to register for participation in the Rights Offer Friday 10 February 2017 Securities listed ex rights Monday 13 February 2017 Last day for receipt of postal registrations Wednesday 15 February 2017 Date of expected receipt of Exchange Control Approval Friday 17 February 2017 Record date Friday 17 February 2017 Rights Offer Opens Monday 20 February 2017 Letters of Allocation listed Monday, 20 February 2017 Last day for dealing in Letters of Allocation Wednesday, 8 March 2017 Last day for splitting Letters of Allocation (14h30). Thursday, 9 March 2017 Rights Offer closes (14h30) (earliest date). Friday, 10 March 2017 Securities listed Monday, 20 March 2017 Date of receipt of Rights Offer proceeds Wednesday, 22 March 2017 Publication of the Rights Offer results Monday 27 March 2017 Publication of the Rights Offer results Friday 24 March 2017

Notes: • The above dates are subject to change. Any amendments to the above timetable will be published in the press. • Existing share certifcates in respect of issued and fully paid up shares in the share capital of Econet Wireless will remain good for delivery regarding interests in the issued share capital of the Company. New share certifcates, to be issued in terms of the Rights Ofer shares subscribed for shall be distributed, at the risk of the subscribing member of the Company, to the address indicated in the Letter of Allocation. • Rights Ofer, shall rank pari passu in all respects with all other shares of the same class, including but not limited to the right to receive all dividends or other distributions declared, made or paid on the issued share capital of Econet Wireless, except that Class A Shares shall not be listed on the Zimbabwe Stock Exchange. • The Debentures will not be listed on the Zimbabwe Stock Exchange.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 5 PART I: SALIENT FEATURES OF THE RIGHTS OFFER

This summary presents the salient information in relation to the Rights Offer, the detailed terms and conditions of which are more fully set out in this document. The Circular should accordingly be read in its entirety for a full appreciation of the rationale for, and the implications of, the Rights Offer, as well as the action required to be taken by each shareholder with respect to the Rights Offer.

THE RIGHTS OFFER

The Rights Offer is an offer to members of the Company, pro rata to each member’s existing shareholding. It comprises of 1,082,088,944 ordinary shares plus 263,050,614 Class A Shares at a subscription price of 5.00 US Cents per share on the basis of circa 82 ordinary shares for every 100 shares already held. Each Rights Offer share shall be linked to a Debenture with an issue price of 4.665 US Cents each and, a coupon rate of 5% per annum thus giving a redemption value of 6.252 US Cents each. The amount due on both the shares and the Linked Debentures shall be payable in full on acceptance of the offer. The Rights Offer is expected to raise an aggregate of US$130,007,739 before expenses.

CAPITAL RAISE STATISTICS

ORDINARY CLASS A SHARES TOTAL SHARES Rights Offer Subscription price per Rights Offer Share US$0.05 US$0.05 Issued and fully paid up shares of US$0.001 each before Rights Offer 909,318,440 730,696,150 1,640,014,590 Rights Offer Shares available to Ordinary Shareholders 745,822,758 745,822,758 Rights Offer Shares available to Class A Shareholders 336,266,186 263,050,614 599,316,800 Total number of Issued shares post the Rights Offer 1,991,407,384 993,746,764 2,985,154,148 Percentage of enlarged share capital available under the Rights Offer 45% Gross Rights Offer proceeds (US$) US$37,291,138 US$29,965,840 US$67,256,978

Debenture Oﬀer Subscription price per Debenture US$0.05 US$0.05 Total number of Debentures post subscription 745,822,758 599,316,800 1,345,139,558 Gross Debenture Oﬀer proceeds (US$) US$34,792,632 US$27,958,129 US$62,750,761

Total Funds Raised US$72,083,770 US$57,923,969 US$130,007,739

SHARE CAPITAL OF ECONET WIRELESS BEFORE AND AFTER THE RIGHTS OFFER

The effects of the Rights Offer on the authorised and issued share capital of Econet Wireless are shown in the table below. BEFORE Rights Offer After Authorised Share Capital Ordinary shares of US$0.001 each 2,000,000,000 2,000,000,000 Class ‘A’ Shares of US$0.001 each 1,000,000,000 1,000,000,000 Total 3,000,000,000 3,000,000,000

Issued Share Capital Ordinary shares of US$0.001 each 909,318,440 1,082,088,944 1,991,407,384 Class ‘A’ Shares of US$0.001 each 730,696,150 263,050,614 993,746,764 Total 1,640,014,590 1,345,139,558 2,985,154,148

Authorised But Unissued Shares Ordinary shares of US$0.001 each 1,090,681,560 8,592,616 Class ‘A’ Shares of US$0.001 each 269,303,850 6,253,236 Total 1,359,985,410 14,845,852

Debentures Issued Debentures of 4.665 US Cents each - 1,345,139,558 1,345,139,558

6 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY FEATURES OF THE DEBENTURES

Number of Debentures to be issued 1,345,139,558 Redemption value per Debenture at end of the term inclusive of the interest coupon for the six year period 6.252 US Cents Subscription price 4.665 US Cents Gross proceeds US$62,750,761 Term 6 years Coupon rate 5% per annum payable on redemption. Coupon payment The Debentures shall be issued on an accrual basis, with the coupon being payable on redemption. Redemption The Debentures shall be redeemable at the end of 6 years from the date of issue, or earlier at the discretion of the Board. In the case of earlier redemption, the Debentures shall be redeemed at a price determined by adding the cumulative interest calculated at a coupon rate of 5% per annum and compounded annually up to the date of redemption to the subscription price. Security Unsecured Tradability The Debentures shall not be listed on the Zimbabwe Stock Exchange. The transfer of the Debentures from one member to another shall require the approval of the Trustees. A banking institution has been selected to hold the office of Trustees as they will be required to perform standard Know Your Customer (KYC) verification, which is required under banking legislation as well as the Money Laundering and Proceeds of Crime Act (Chapter 9:24). Approval of transfer of the debentures between debenture holders is subject to these standard due diligence procedures. Other features Each Debenture shall be linked to a Rights Offer Share on a ratio of 1:1. The Debentures shall be automatically delinked from the Rights Offer Shares immediately after the shares and the Debentures have been issued and allotted. The subscription price for the Debentures shall be payable on acceptance of the Rights Offer. It shall not be possible to subscribe for Rights Offer Shares alone without subscribing for the Debentures nor shall it be possible to subscribe for the Debentures alone without subscribing for the Rights Offer Shares.

RATIONALE OF THE CAPITAL RAISE

In recent months it has become clear that there is a critical shortage of foreign currency in the overseas nostro accounts of Zimbabwe’s banks, and that the flow of local USD cash that those banks can export to fund their nostro accounts has diminished materially. This has made it extremely difficult for the Company and its subsidiaries to service their financial obligations to lenders and creditors outside Zimbabwe. To avoid defaulting on its loan obligations, the Company intends to raise foreign currency from its members by way of a Rights Offer of shares and Linked Debentures.

It is a condition of the proposed Rights Oﬀer that the members shall follow their rights by paying the proceeds of the oﬀer in United States Dollars directly outside Zimbabwe into the Company’s debt service account with AFREXIM Bank outside Zimbabwe, (“the designated account”). The Company’s locally available resources, which cannot be used to service external obligations because of the reasons cited above, will be applied to meet local working capital requirements and as much as possible to return value to shareholders.

The Rights Offer shares are priced at a discount to market in order to provide an incentive for members to invest capital into a deflationary and illiquid environment where it is extremely difficult to withdraw cash in United States Dollars, or to make foreign payments. The Linked Debentures are being issued in order to mitigate the dilutive impact of the Rights Offer. Both the shares and the Debentures alleviate the burden on the Company of having to make mandatory annual foreign currency payments in the short-term, in an illiquid environment where such foreign currency is not available.

READ THE WHOLE OF THIS DOCUMENT

This document should be read in its entirety, and not just these salient features.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 7 PART II: CHAIRMAN’S LETTER

ECONET WIRELESS ZIMBABWE LIMITED

(Incorporated in Zimbabwe on 4 August 1998 under Company registration number 7548/98) ZSE alpha code: ECO ISIN: ZW 000 901 212 2

Directors: Dr James Myers (Non – Executive Chairman); Mr Strive Masiyiwa ( Executive Director); Mr Craig Fitzgerald (Non- Executive Director); Mr Douglas Mboweni (Executive Director – Chief Executive Oﬃcer); Mr Roy Chimanikire (Executive Director – Finance Director); Mrs Tracy Mpofu ( Non – Executive Director); Mr Krison Chirairo ( Executive Director); Ms Beatrice Mtetwa (Non – Executive Director); Mrs Sherree Shereni (Non – Executive Director); Mr Godfrey Gomwe (Non – Executive Director); and Mr Martin Edge (Non – Executive Director).

Address: Econet Wireless Zimbabwe Limited, 2 Old Mutare Road, Harare, Zimbabwe

17 January 2017

Dear Shareholder

PROPOSED RIGHTS ISSUE FOR ECONET WIRELESS LIMITED

2.1 INTRODUCTION The Board of Directors is proposing that, subject to certain conditions precedent, your Company engages in a capital raise of US$130,007,739 by way of a Right Oﬀers of ordinary shares and Linked Debentures in order to facilitate the servicing of obligations to its foreign lenders. Collectively, the Directors’ proposals will be referred to herein as the “capital raise” or “Rights Oﬀer”.

2.2 PURPOSE OF THIS CIRCULAR The principal purpose of the full version of the Circular, in addition to that of the Abridged Version of this Circular is to furnish members with the terms and conditions of the Rights Offer and to provide them with the Letters of Allocation that they shall use in participating in the Rights Offer. Any members not registered to participate in the Rights Offer shall be entitled to a copy of the full version of this Circular free of charge within seven days of requesting such copy in writing and delivering the letter to the Group Company Secretary at the Registered Address of the Company.

2.3 THE PROPOSED CAPITAL RAISE

2.3.1 The Share Offer In terms of the Rights Offer, shareholders shall be offered, pro rata to their shareholdings, 1,082,088,944 ordinary shares plus 263,050,614 Class A shares at a subscription price of 5.00 US Cents each on the basis of circa 82 ordinary shares for every 100 shares already held. Each share shall be linked to a Redeemable Debenture with an issue price of 4.665 US Cents each, a coupon rate of 5% per annum payable upon redemption, and a redemption value of 6.252 US Cents each inclusive of the cumulative interest coupon for the 6 year period. The subscription price for the Shares and the Debentures shall be payable in full on acceptance of the offer.

Each class of shareholders will be entitled to follow their rights and contribute the capital required pro-rata to their existing shareholding in Econet Wireless. If a shareholder decides not to follow their rights, the Rights Oﬀer shall be renounceable in terms of ZSE listings requirements only in favour of an existing shareholder with capacity to take up the Rights Oﬀer Shares and the Linked Debentures.

2.3.2 The Linked Debenture Offer Each Debenture shall be linked to a Rights Offer share on a ratio of 1:1. Each Debenture shall have an issue price of 4.665 US Cents, a coupon rate of 5% per annum payable upon redemption, and a redemption value of 6.252 US Cents inclusive of the accumulated interest, and shall be redeemable after 6 years or earlier as determined by the Company at its absolute discretion. The Linked Debentures shall be issued on an accrual basis, with no periodic payments of interest but carry embedded value which is realisable upon maturity. It shall not be possible to subscribe for Rights Offer Shares alone without subscribing for the Debentures nor shall it be possible to subscribe for the Debentures alone without subscribing for the Rights Offer Shares. The rest of the terms and conditions of the Debentures shall be set out in the Debenture Trust Deed a copy of which shall be available for inspection, provided that in the event of any inconsistency between the terms of the Debenture Trust Deed and this Circular, the terms of this Circular shall prevail.

8 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 2.3.3 Rationale For The Capital Raise In recent months it has become clear that there is a critical shortage of foreign currency in the overseas nostro accounts of Zimbabwe’s banks, and that the flow of local USD cash that those banks can export to fund their nostro accounts has diminished materially. This has made it extremely difficult for the Company and its subsidiaries to service their financial obligations to lenders and creditors outside Zimbabwe. To avoid defaulting on its loan obligations, the Company intends to raise foreign currency from its members by way of a Rights Offer of shares and Linked Debentures.

2.3.4 Pricing of the Rights Offer Shares The Rights Offer shares are priced at a discount to the current trading market price in order to provide an incentive for shareholders to invest capital in a deflationary and illiquid environment where it is extremely difficult to withdraw cash in United States Dollars, or to make foreign payments. The Debentures are intended to mitigate the dilutive impact of the Rights Offer.

Both the Rights Oﬀer shares and the Linked redeemable Debentures have been designed to alleviate the burden on the Company of having to make mandatory annual foreign currency payments in the short-term, in an illiquid environment where such foreign currency is not available.

Ernst & Young acting as an Independent Financial Advisor to the Board has issued a “fair and reasonableness opinion” on the pricing of the shares and the Debentures. The opinion is part of this Circular.

2.3.5 Pricing of Debenture Shareholders are being given the opportunity to earn a fixed US Dollar return of 5% per annum by subscribing to the Linked Debentures. The Debentures allow the Company to defer a debt settlement, which is due and payable within the next 12 – 18 months by a further 4 – 5 years. This will afford the Company an opportunity to accumulate foreign currency resources to fund the redemption of these Debentures at maturity. It also provides an important incentive for shareholders to participate in the Rights Offer and the Linked Debentures while mitigating the dilutive impact of the Rights Offer on those shareholders who may not have access to external US Dollar resources with which to follow their rights. Subject to the availability of United States Dollars with which to make external payments, it is the opinion of the Directors, that the Company will be able to mobilise sufficient resources over the 6-year period to redeem the Linked Debentures.

2.3.6 Payment Modalities It is a condition of the proposed Rights Offer that the members shall follow their rights by paying the subscription price of the shares and Linked Debentures in United States Dollars directly outside Zimbabwe into the Company’s debt service account with AFREXIM Bank, (“the designated account”). Payment will be recognised in cleared funds reflecting in the designated account on or before Monday 22 March 2017. AFREXIM Bank is the Security Trustee and Facility Agent, selected by the syndicate of lenders under the Company’s existing loan facilities and is responsible for receiving and allocating payments to all the lenders. It is for this reason that AFREXIM Bank has been selected as the receiving bank in this Rights Offer Proposal. The existing loan obligations of the Company are tabulated below:

The Company’s Loan Obligations Financier Initial Capital Eﬀective Projected Facility Balance Interest rate Date of Last (US$) (US$) (EIR) Payment China Development Bank 135,000,000 13,238,648 6.4% 12-Apr-17 China Development Bank 93,000,000 75,096,719 5.7% 21-Aug-19 Ericsson Credit AB 50,562,449 15,190,091 4.4% 15-Apr-18 African Export and Import Bank 28,000,000 18,666,667 9.0% 05-Jul-17 Industrial Development Corporation 20,000,000 6,000,000 6.4% 15-Dec-17 Total Capital Obligation 128,192,125

The weighted average interest rate on long-term borrowings for the Company as at 29 February 2016 was 7.1% (2015: 7.3%). In addition to the all inclusive rate of borrowing of 7.1% the Group pays guarantee fees of 6% per annum to Econet Global Limited for the guarantee provided on the multi-creditor loan facilities.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 9 2.4 MECHANICS OF THE CAPITAL RAISE

2.4.1 The Rights Offer The terms of the Rights Offer are as tabulated below. ORDINARY SHARES CLASS A SHARES TOTAL Rights Offer Subscription price per Rights Offer Share US$0.05 US$0.05 Issued and fully paid up shares of US$0.001 each before Rights Offer 909,318,440 730,696,150 1,640,014,590 Rights Offer Shares available to Ordinary Shareholders 745,822,758 745,822,758 Rights Offer Shares available to Class A Shareholders 336,266,186 263,050,614 599,316,800 Total number of Issued shares post the Rights Offer 1,991,407,384 993,746,764 2,985,154,148 Percentage of enlarged share capital available under the Rights Offer 45% Gross Rights Offer proceeds (US$) US$37,291,138 US$29,965,840 US$67,256,978 Debenture Offer Subscription price per Debenture US$0.05 US$0.05 Total number of Debentures post subscription 745,822,758 599,316,800 1,345,139,558 Gross Debenture Offer proceeds (US$) US$34,792,632 US$27,958,129 US$62,750,761

Total funds raised US$72,083,770 US$57,923,969 US$130,007,739

The Rights Offer Shares will rank pari passu in every respect with all existing Econet Wireless shares including the right to receive all dividends and other distributions thereafter declared, made or paid on the issued share capital of Econet Wireless with effect from the date of issue, except that the Class A shares shall not be listed on the Zimbabwe Stock Exchange. PART III of this document commencing on page 15 provides further information regarding the Rights Offer.

2.4.2 Features of the Debentures Number of Debentures to be issued 1,345,139,558 Redemption value per Debenture at end of the term inclusive of the interest coupon for the six year period 6.252 US Cents Subscription price 4.665 US Cents Gross proceeds US$62,750,761 Term 6 years Coupon rate 5% per annum payable on redemption. Coupon payment The Debentures shall be issued on an accrual basis, with the coupon being payable on redemption. Redemption The Debentures shall be redeemable at the end of 6 years from the date of issue, or earlier at the discretion of the Board. In the case of earlier redemption, the Debentures shall be redeemed at a price determined by adding the cumulative interest calculated at a coupon rate of 5% per annum and compounded annually up to the date of redemption to the subscription price. Security Unsecured Tradability The Debentures shall not be listed on the Zimbabwe Stock Exchange. The transfer of the Debentures from one member to another shall require the approval of the Trustees. A banking institution has been selected to hold the office of Trustees as they will be required to perform standard Know Your Customer (KYC) verification, which is required under banking legislation as well as the Money Laundering and Proceeds of Crime Act (Chapter 9:24). Approval of transfer of the debentures between debenture holders is subject to these standard due diligence procedures. Other features Each Debenture shall be linked to a Rights Offer Share on a ratio of 1:1. The Debentures shall be automatically delinked from the Rights Offer Shares immediately after the shares and the Debentures have been issued and allotted. The subscription price for the Debentures shall be payable on acceptance of the Rights Offer. It shall not be possible to subscribe for Rights Offer Shares alone without subscribing for the Debentures nor shall it be possible to subscribe for the Debentures alone without subscribing for the Rights Offer Shares.

10 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 2.5 APPLICATION OF PROCEEDS OF THE CAPITAL RAISE

The Board intends to use the proceeds of the Rights Oﬀer, amounting to approximately US$ 130 million to repay all the Company’s secured term loan obligations tabulated on page 9 of this Circular together with the expenses of this Rights Oﬀer. As the debt is being retired in full before its due date, lenders normally impose prepayment penalties because they will be deprived of the interest that would have been earned over the full term of the loan instrument. The Company has made an application for the waiver of these penalties and indications so far are that the request will be favourably considered by the lenders.

2.6 EXPENSES OF THE RIGHTS OFFER

The costs of implementing the Rights Oﬀer are estimated at 3.1% (2% being Underwriting Fees) of the amount to be raised, or US$4,030,000 which relates to underwriting fees, advisory fees, printing, regulatory fees and other professional charges. These expenses will be paid by the Company out of the proceeds of the Oﬀer.

In the opinion of the Directors, the costs of the Rights Offer are in line with other Rights Offers recently concluded in Zimbabwe and are justified in light of the critical importance of this Capital Raise in securing the Company’s future.

2.7 CONDITIONS PRECEDENT

The following constitute the conditions precedent to the current Rights Offer: • Approval by shareholders of the resolutions at the EGM to be held on Friday 3 February 2017 in terms of the EGM notice incorporated herein; • Approval by the ZSE’s Listings Committee of the listing of the new Econet Wireless ordinary shares to be issued to shareholders who meet the terms of the Rights Offer as outlined in this Circular; • The Underwriting Agreement entered between Econet Global Limited (EGL) and Econet Wireless remaining in full force and effect; and • The approval of the Reserve Bank of Zimbabwe for the proceeds of the Rights offer to be paid by each participating shareholder into the debt service account held by the Company with AFREXIM Bank outside Zimbabwe and for the proceeds of the Rights Offer to be applied by the Company to repay its secured loan obligations.

2.8 UNDERWRITING

The Rights Oﬀer will be fully underwritten by Econet Global Limited. Econet Global Limited is a shareholder of the Company currently holding 30.02% of the issued share capital of Econet Wireless Zimbabwe Limited. A copy of the Underwriting Agreement is available for inspection at the registered oﬃces of Econet Wireless Zimbabwe limited.

The Directors have made due and careful enquiry to conﬁrm that the Underwriter is able to meet its commitments in terms of the Rights Oﬀer. Further particulars of the Underwriter are set out in PART XIII of this document.

2.9 RELATED PARTY STATEMENT

Steward Bank Limited, a wholly owned Subsidiary of Econet Wireless Zimbabwe Limited, has been retained as the Exchange Control Advisor and will receive a fixed fee of US$40,000 (Forty Thousand United States Dollars) for the services provided in connection with the proposed capital raise. The Underwriter, EGL is a material security holder by general definition under ZSE Rule 10.1 with a 30.02% shareholding. However in this Capital Raise, EGL is not contemplated as a contra-party whatsoever but rather as an ordinary shareholder acting in concert with others in pursuance of their rights that have been offered to all shareholders of the Company on the same terms.

In recognition of the foregoing, the ZSE Rules provide for the exclusion of EGL as a related party under “Transactions not regarded as Related Party Transaction” Rule 10.6(c) (ii).

In addition, a “fair and reasonable” opinion by a professional independent expert has been given as part of this Circular under Rule 10.5(2) (a).

In its role as an Underwriter of this Rights Oﬀer, EGL is also not regarded as a related party for the purposes of Underwriting under Rule 10.6(g).

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 11 2.10. LISTING ON THE ZSE

It is not the desire of the Company to delist from the Zimbabwe Stock Exchange. Should the Underwriter hold 35% or more of the issued share capital of the Company after it takes up the unsubscribed shares pursuant to the Rights Oﬀer, the underwriter shall either make an oﬀer of its shareholding to minorities in accordance with Part 9 of the listing rules within six (6) months or seek an exemption.

2.11. EFFECTS OF THE RIGHTS OFFER

2.11.1 Directors and Management The Rights Oﬀer will not have any impact on the composition of the Board of Directors and the management team. The Directors and management believe that the proposed Rights Oﬀer is in the best interests of the Company and its Shareholders in that it averts a possible default by the Company on its foreign secured loan obligations.

2.11.2 Financial Eﬀects of the Capital Raise

2.11.2.1 Pro Forma Balance Sheet and Income Statement The pro forma ﬁnancial information is set out in PART X of this circular.

2.11.2.2 Reporting Accountants’ Report on Pro Forma Financial Effects of the Rights Offer The reporting accountants’ report on the pro forma financial information is set out in PART IX of this circular.

2.112.3 Impact on Share Capital of Econet Wireless The impact of the capital raise on the share capital of Econet Wireless is set out below.

BEFORE RIGHTS OFFER AFTER Authorised share capital Ordinary shares of US$0.01each 2,000,000,000 2,000,000,000 Class ‘A’ Shares of US$0.001 each 1,000,000,000 1,000,000,000 Total 3,000,000,000 3,000,000,000

Issued share capital Ordinary shares of US$0.001 each 909,318,440 1,082,088,944 1,991,407,384 Class ‘A’ Shares of US$0.001 each 730,696,150 263,050,614 993,746,764 Total 1,640,014,590 1,345,139,558 2,985,154,148

Authorised but unissued shares Ordinary shares of US$0.001 each 1,090,681,560 8,592,616 Class ‘A’ Shares of US$0.001 each 269,303,850 6,253,236 Total 1,359,985,410 14,845,852

Debentures Issued Debentures of 4.665 US cents each - 1,345,139,558 1,345,139,558

2.12 RIGHTS ATTACHING TO SHARES AND DEBENTURES

Save for the fact that the Class A shares shall not be listed on the Zimbabwe Stock Exchange, all the authorised and issued shares will rank pari passu in every respect and accordingly, no shares have any special right to dividends, capital or proﬁts or any other right, including redemption rights and rights on liquidation or distribution of capital assets.

Any variation in rights attaching to shares will require the consent of shareholders in a general meeting in accordance with the company’s Memorandum of Incorporation.

Only such members that are registered in the Company’s register on the day when a distribution is declared or on such other day as may be determined by the Board as the record date for the distribution, will be entitled to receive the distribution so declared.

12 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 2.13 OPTIONS AND PREFERENTIAL RIGHTS IN RESPECT OF THE RIGHTS OFFER SHARES

There are no preferential conversions and/or exchange rights in respect of any of the Rights Oﬀer Share.

No options or preferential rights of any kind was or is proposed to be given to any person to subscribe for the shares of the Company.

There are no contracts or arrangements, either actual or proposed, whereby any option or preferential right of any kind has been or will be given to any person to subscribe for any shares in the Company.

2.14 REPAYMENT, REDEMPTION AND PURCHASE OF DEBENTURES

The Debentures shall become redeemable at nominal value at the end of a period of six years or on an earlier date determined by the Board of the Company at its discretion.

2.15 CONSEQUENCES OF NOT RAISING ADDITIONAL CAPITAL

In the event that the proposed Rights Oﬀer is not implemented the Company will be faced with the risk of defaulting on its foreign obligations which could lead to the secured creditors exercising their collateral against the Company and would also damage the Company’s future prospects of accessing international capital markets to ﬁnance its business.

2.16 PROSPECTS

The ongoing foreign currency shortages and general liquidity constraints have made it diﬃcult for customers to spend on goods and services. The stagnation of the economy and the consequent impact on consumers will continue to put a strain on all businesses operating in Zimbabwe.

A challenging regulatory environment and the Government’s need to raise additional taxes from a shrinking tax base also pose a challenge to the Company’s business.

In spite of these challenging operating circumstances, the Company continues to tailor its products and services to remain relevant to its customers, understanding that they are under financial strain and so are demanding even greater value for money. Consequently, the Company will continue to review its product pricing, bundle composition, marketing and selling strategies to offer solutions based on clearly understood customer segments and markets. The Board and management continue to seek cost efficiencies, wherever possible, in order to deliver a lean and agile operation.

The Company’s operating model remains the foundation on which it will deliver sustainable performance in the future. Through relentlessly pursuing innovation, the Company will continue to roll out products and services that are customer centric and technologically relevant.

2.17 DOCUMENTS AVAILABLE FOR INSPECTION

The following documents or copies thereof are available for inspection at the registered oﬃce of Econet Wireless during normal business hours: • Memorandum and Articles of Association of the Econet Wireless; • The Audited ﬁnancial statements of Econet Wireless for the years ended February 2013, 2014, 2015 and 2016; • Notice of Shareholders Extraordinary General Meeting (EGM); • The experts’ consents referred to in this Circular; • The original copy of the signed Circular to shareholders; • Underwriting Agreement; • The Debenture Trust Deed; and • Accounting policies

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 13 2.18 EXPERTS AND OTHER CONSENTS

Each of the advisors, whose names appear in the “Corporate Information and Advisors” section of this circular have consented and have not, prior to the date of publication of this circular withdrawn their written consent to the inclusion of their names and, where applicable, reports in the form and context in which they appear in this circular.

2.19 OPINIONS AND VOTING RECOMMENDATIONS

The Directors consider the terms and conditions of the Rights Oﬀer to be fair and reasonable so far as all the Shareholders as a collective are concerned and to be in the best interests of the Company and its Shareholders.

Consequently, the Directors unanimously recommend that Shareholders follow their rights.

Yours faithfully, For and behalf of the Board of Directors of Econet Wireless Zimbabwe Limited

Dr J Myers Chairman

14 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART III: TERMS AND CONDITIONS OF THE RIGHTS OFFER

3.1 TERMS OF THE RIGHTS OFFER

The Board of Directors have resolved to offer to the Shareholders of the Company, registered as such at the close of business on Friday 17 February 2017, being the Record Date 1,082,088,944 ordinary shares plus 263,050,614 Class A Shares at a subscription price of 5.00 US Cents per share on the basis of circa 82 ordinary shares for every 100 shares already held. Each Rights Offer share shall be linked to a Debenture redeemable 6 years from the date of issue, or earlier at the Company’s sole discretion, with an issue price of 4.665 US Cents each, a coupon rate of 5% per annum and a redemption value of 6.252 US Cents each inclusive of the interest. The amount due on both the shares and the Linked Debentures shall be payable in full on acceptance of the offer. The Debentures shall be delinked from the shares automatically upon issue.

3.2 DATE OF OPENING AND CLOSING OF RIGHTS OFFER

The Rights Oﬀer will open on Monday 20 February 2017 and close on Friday 10 March 2017.

3.3 COURSES OF ACTION

Set out below are the options available to Econet Wireless Zimbabwe Limited in Shareholders with respect to their rights in terms of the Rights Oﬀer:

3.4 ACCEPTANCE  SUBSCRIBE FOR ALL THE RIGHTS OFFER SHARES

A shareholder who wishes to take up their rights in terms of the Rights Oﬀer is required to complete the renounceable Letter of Allocation FORM A.

3.5 SPLITTING

A shareholder who wants to take up some but not all of their rights should complete FORM B as set out in the Letter of Allocation, and return it by hand only (during normal business hours) to Econet Wireless Zimbabwe Limited, 2 Old Mutare Road, Harare, Zimbabwe to be received on or before Thursday 9 March 2017.

The rights to the oﬀer shares that the shareholder does not wish to follow will be forfeited to the other shareholders in Econet Wireless Zimbabwe Limited.

3.6 RENUNCIATION  ELECT NOT TO FOLLOW RIGHTS

The right to subscribe for the Rights Oﬀer Shares in Econet Wireless Zimbabwe Limited, as detailed in this Document, may be renounced (nil paid) in accordance with the ZSE Listing Requirements.

In the event that the Company does not receive a duly completed Letter of Allocation from a Shareholder on or before Wednesday 8 March 2017, it will be presumed that the particular Shareholder has waived his rights and the Rights Offer Shares offered to that Shareholder will automatically lapse and the Board will forthwith offer them to the Underwriter.

3.7 PAYMENT

The amount due on acceptance is payable in the currency of the United States of America in an account held by the Company at AFREXIM Bank outside Zimbabwe. The cash shall be payable into the designated account whose details are given below before Monday 22 March 2017. Account Currency: USD Correspondent Bank: Standard Chartered Bank - London Correspondent Bank BIC: SCBLGB2L Beneficiary Account Name: African Export Import Bank Beneficiary Account Number: 01270797750 Beneficiary IBAN: GB94 SCBL 6091 0412 7079 77 Beneficiary Swift Code: AFXMEGCA Reference: EWZ Rights Offer Intermediary Bank: Standard Chartered Bank, New York Intermediary Bank BIC: SCBLUS33

Payment will be recognised in cleared funds reﬂecting in the designated account on or before Monday 22 March 2017. Any shareholder making a payment from Zimbabwe should consult their Exchange Control Advisors to establish whether or not they require individual Exchange Control Approvals to make the payments.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 15 3.8 EXCHANGE CONTROL

The Company shall procure the Exchange Control Approvals necessary to: • Keep the Rights Offer proceeds outside Zimbabwe; • Utilise the Rights Offer proceeds for the purposes of paying its secured loan obligations; and • Ensure that the payments received from non-resident shareholders or underwriter to be deemed as foreign currency received in Zimbabwe through normal banking channels for purposes of the Exchange Control Regulations, and that the securities that the Company will issue to non-residents pursuant to the Rights Offer be designated non- resident so as to provide any non-resident holder with full rights of repatriation of Capital, Dividend and any Interest thereon.

The Company Shall Seek Exchange Control approval for members to follow their rights in compliance with the Exchange Control Regulations.

3.9 DIVIDENDS

The Rights Oﬀer Shares issued in accordance with the Rights Oﬀer will be issued as fully paid and will rank pari passu in every respect from the date of issue with the other shares of the Company.

3.10 FRACTIONAL RIGHTS

Only whole numbers of Rights Oﬀer shares will be issued and qualifying shareholders will be entitled to subscribe for rounded numbers of Rights Oﬀer shares once the ratio of entitlement has been applied. Fractional rights of 0.5 or greater will be rounded up and fractional rights of less than 0.5 will be rounded down.

3.11 LISTING AND REGISTRATION OF RIGHTS OFFER SHARES

The listing committee of the ZSE has granted a primary listing for, and permission to deal in, all renounceable letters of Allocation (nil paid) relating to the new Rights Oﬀer Shares, between Monday 20 February 2017 and Wednesday 8 March 2017.

Application has been made for the Rights Offer shares offered in term of the Rights Offer to be listed on the ZSE from Monday 20 March 2017.

Persons becoming shareholders as a result of the Rights Oﬀer will be placed on Econet Wireless Zimbabwe Limited’s share register. The transfer secretaries in respect of the Rights Oﬀer Shares are First Transfer Secretaries, whose details are set out in the “Advisors” section.

3.12 RIGHTS OFFER SHARE CERTIFICATES

The share certiﬁcates in respect of the Rights Oﬀer will be distributed to Shareholders from Monday 27 March 2017.

16 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART IV: TERMS AND CONDITIONS OF THE DEBENTURES

The salient features of the Debentures are tabulated below:

Number of Debentures to be issued 1,345,139,558 Redemption value per Debenture at end of the term inclusive of the interest coupon for the six year period 6.252 US Cents Subscription price 4.665 US Cents Gross proceeds US$62,750,761 Term 6 years Coupon rate 5% per annum compounded annually and payable on redemption. Coupon payment The Debentures shall be issued on an accrual basis, with the coupon being payable on redemption. Redemption The Debentures shall be redeemable at the end of 6 years from the date of issue, or earlier at the discretion of the Board. In the case of earlier redemption, the Debentures shall be redeemed at a price determined by adding the cumulative interest calculated at a coupon rate of 5% per annum and compounded annually on the subscription price up to date of redemption. Security Unsecured Tradability The Debentures shall not be listed on the Zimbabwe Stock Exchange. The transfer of the Debentures from one member to another shall require the approval of the Trustees. A banking institution has been selected to hold the office of Trustees as they will be required to perform standard Know Your Customer (KYC) verification, which is required under banking legislation as well as the Money Laundering and Proceeds of Crime Act (Chapter 9:24). Approval of transfer of the debentures between debenture holders is subject to these standard due diligence procedures. Other features Each Debenture shall be linked to a Rights Offer Share on a ratio of 1:1. The Debentures shall be automatically delinked from the Rights Offer Shares immediately after the shares and the Debentures have been issued and allotted. The Debentures shall be payable on acceptance of the Rights Offer. It shall not be possible to subscribe for Rights Offer Shares alone without subscribing for the Debentures nor shall it be possible to subscribe for the Debentures alone without subscribing for the Rights Offer Shares.

The rest of the terms and conditions of the Debentures shall be set out in the Debenture Trust Deed a copy of which shall be available for inspection, provided that in the event of any inconsistency between the terms of the Debenture trust deed and this circular, the terms of this circular shall prevail.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 17 PART V: SUMMARY INFORMATION ON ECONET WIRELESS ZIMBABWE LIMITED

5.1 HISTORY

Econet launched its business on the 10th of July 1998 and listed on the Zimbabwe Stock Exchange on the 17th of September 1998. It is one of the largest companies on the Zimbabwe Stock Exchange in terms of market capitalisation and proﬁtability. The Company has over 10 million subscribers and continues to grow its subscriber base.

Pioneering remains a key value at Econet. In 2009, the network became the ﬁrst operator in Zimbabwe to launch data services under 3 G technologies, and in 2010, Econet launched the country’s ﬁrst mobile broadband network.

5.2 BUSINESS MODEL

5.2.1 Econet Wireless Zimbabwe Limited - Zimbabwe Holding Company Econet Wireless Zimbabwe Limited, which is listed on the Zimbabwe Stock Exchange (ZSE), is the holding Company of businesses involved in various sectors of the economy as detailed below.

SUBSIDIARY COMPANIES Econet Wireless (Private) Limited Cellular network operator.

EW Capital Holdings (Private) Limited An investment vehicle through which the Group holds a variety of investments carefully selected with the twin objectives of growing earnings and preserving value for shareholders. Transaction Payment Solutions (Private) The Company is a leading provider of financial transaction, switching, point-of-sale Limited and overlay services that benefits from the convergence of banking, information technology and telecommunications. The Company provides local and international financial institutions and telecommunications operators’ access to cutting-edge technology to enhance customer service, in partnership with one of the world’s leading manufacturers of smart card-based point-of-sale systems. Steward Bank Limited Steward Bank Limited offers commercial banking services in Zimbabwe. It plays a pivotal role in the Group, especially for EcoCash. Pentamed Investments (Private) Limited The group, through wholly-owned Pentamed Investments (Private) Limited, holds 63% of the ordinary shares of Mutare Bottling Company (Private) Limited. It also holds 6% in the form of convertible instruments. Mutare Bottling Company operates the Coca Cola Company’s bottling franchise in the eastern region of Zimbabwe. Steward Health (Private) Limited Steward Health is a leading provider in tailor made insurance solutions. Econet Life (Private) Limited Econet Life (Private) Limited is an underwriter to EcoSure Funeral Cover. EcoSure is a product focused on providing funeral cover that guarantees a promised amount and/or benefit, depending on the Policy Package to be paid out in the event of death of the Insured.

18 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY ASSOCIATE COMPANY Data Control And Systems (1996) (Private) Liquid Zimbabwe is the leading provider of fibre optic infrastructure in Zimbabwe Limited T/A Liquid Telecom Zimbabwe and to date has laid over 10,000 km of fibre optic cable. An extensive fibre network which has linkages within the major cities and towns as well as long distance links to the EASSy and Seacom cables has been established. The fibre network has been developed to provide alternative routes for connection to allow easy recovery in failure events which makes it a robust network. This fibre is used to provide backhaul infrastructure for the mobile network operator’s base stations and acts as a link to the outside world by providing a reliable transmission for internet traffic outside Zimbabwe.

5.2.2 Associates And Subsidiaries The Group has associates and subsidiaries in diverse industry sectors which complement the overall Group strategy. These include subsidiaries and associates in financial services, fibre optic transmission delivery, financial transaction processing and switching. The launch of EcoCash, mobile financial services and subsequent acquisition of bank has been one of the group’s major initiatives of recent years. The bank provides the licensing and regulatory framework for the group to provide mobile financial services and to launch certain savings and credit products. Significant progress has been made in restructuring the bank’s balance sheet and right- sizing the business. The restoration of profitability of the bank via the development of new income streams is now key to delivering shareholder value.

Liquid Zimbabwe, provides the group with fibre transmission and backhaul infrastructure. This investment is now contributing profitably to the Group. Its continued network expansion and the stable platform that it provides are critical as the Group continues to grow its data and voice traffic. The Company has also rolled out the most extensive Wi-Fi system throughout the country. Many of these Wi-Fi sites have the unique capability for seamless transition from mobile broadband.

5.3 HISTORICAL FINANCIAL INFORMATION OF ECONET

The Historical ﬁnancial information is set out in PART VIII of this circular.

5.4 PERFORMANCE REVIEW FOR THE 6MONTHS ENDED 31 AUGUST 2016

Revenue for the half year ended 31 August 2016 was $302 million compared to $323 million for the same period last year. Profit after taxation (PAT) was $15.0 million compared to $23.8 million for the year. Profitability was affected by the decline in revenues as a result of the difficult economic environment. The Company therefore continues to focus on cost reduction in order to protect margins and profitability. Although the cash position continues to be healthy, the NOSTRO funding constraints being experienced by all local banks have adversely affected our ability to meet US Dollar den.

The business continued its focus on growing revenue, particularly from data and mobile financial services, which registered double digit growth of 11% and 22% respectively. Financial services revenue contribution constituted 34% of total Group revenue, and this validates our strategy, which we commenced a few years ago, to grow non-voice revenues. The Company has successfully concluded the network modernization project, which resulted in the deployment of over 400 new LTE sites and upgrades to over 250 3G sites. An additional 88 new Wi-Fi coverage sites were made country wide. In terms of coverage, speeds and user experience, the Econet network remains unrivalled in its performance. Customers can now enjoy enhanced Internet experience through increased data capacity and performance. Data billing capacity was upgraded to cater for increased data traffic and complexity as well as to offer quality user experience and value for money to our customers.

Partnerships are key to the growth imperatives of EcoCash. In view of the need to increase remittances and complement eﬀorts by Government to generate foreign currency for the country, the Company entered into partnerships with various Mobile Transfer Agencies (MTA’s) including MoneyGram, Western Union and WorldRemit. EcoCash now has 9 partnerships with various MTAs. The EcoCash platform continues to grow supported by a wide network of agents and merchants that accept EcoCash as a mode of payment.

The micro insurance product, EcoSure, oﬀers the most aﬀordable funeral cover, is widely acknowledged as the fastest growing insurance product in Zimbabwe. EcoSure won an award for being the most innovative product (Life assurance) in Southern Africa. The system that it runs on earned Econet the best technical Company award at the Micro insurance forum held in July 2016. EcoSure’s subscribers have surpassed the 1 million mark spurred by the newly introduced burial society product, which is transforming communities.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 19 5.5 SHAREHOLDERS

Econet Wireless Zimbabwe Limited has 9,177 shareholders. As at Wednesday 30 November 2016, being the last practicable date, the top twenty Econet Wireless Zimbabwe Limited shareholders holding 91.25% of the issued share capital of the Company comprised of. Account Name Total Shares % of Total

1 ECONET WIRELESS GLOBAL LIMITED 492,325,748 30.02 2 STANBIC NOMINEES (PRIVATE) LIMITED (NNR) 304,681,312 18.58 3 ECONET WIRELESS ZIMBABWE LIMITED, 161,715,191 9.86 4 STANBIC NOMINEES (PRIVATE) LIMITED 110,888,435 6.76 5 AUSTIN ECO HOLDINGS LIMITED - NNR 89,872,460 5.48 6 OLD MUTUAL LIFE ASSURANCE COMPANY OF ZIMBABWE LIMITED 83,187,752 5.07 7 ECONET WIRELESS ZIMBABWE SPV LIMITED, 48,475,095 2.96 8 EBENEZER TRUST, 28,959,972 1.77 9 STANDARD CHARTERED NOMINEES (PRIVATE) LIMITED, 23,928,080 1.46 10 NORTHUNDERLAND INVESTMENTS (PVT) LTD 22,020,090 1.34 11 STANDARD CHARTERED NOMINEES (PVT)LTD - NNR , 21,354,857 1.30 12 AMRO INTERNATIONAL HOLDINGS LTD (NNR), 15,033,962 0.92 13 MINING INDUSTRY PENSION FUND 11,318,349 0.69 14 HELLIKOP INVESTMENTS (PVT) LTD-NNR, 10,699,010 0.65 15 NATIONAL SOCIAL SECURITY AUTHORITY 10,454,285 0.64 16 PRESSFORTH INVESTMENTS (PRIVATE) LIMITED 10,317,570 0.63 17 ECONET EMPLOYEES BENEFICIARY TRUST 9,936,300 0.61 18 LOCAL AUTHORITIES PENSION FUND 8,430,062 0.51 19 COVERSITE (PRIVATE) LIMITED 7,014,684 0.43 20 CAPERNAUM TRUST ENDOWMENT FUND 6,218,472 0.38

TOTAL TOP 20 1,476,831,686 90.05

OTHERS 163,182,904 9.95

TOTAL ISSUED SHARES 1,640,014,590 100.00

Assuming all shareholders follow their rights, there will be no change in the shareholding structure of the Company.

Part XI of this Document contains an illustrative table of entitlements for Econet Wireless Zimbabwe Limited Shareholders with respect to the Rights Oﬀer and share repurchase on the basis of full subscription in United States Dollars.

5.6 CORPORATE GOVERNANCE

The Board has eleven members made up of four executive Directors, seven non-executive Directors. A non-executive director chairs the Board. The offices of the Chairman and Chief Executive Officer are separate. The Company recognises how it is essential to separate the two offices. Apart from the good corporate governance aspect, the separation ensures that the Chief Executive Officer and the executive Directors focus on operational issues while the Chairman and the non-executive Directors concentrate on the oversight role. In particular, this clear division of responsibilities enables the Board Chairman to exercise effective leadership of the Board.

The non-executive Directors are drawn from a wide range of ﬁelds, thus ensuring that the Board has the right balance of skills and experience. The election to the Board of non-executive Directors is subject to conﬁrmation by shareholders.

In terms of the Company’s Articles of Association and the Companies Act (Chapter 24:03) at least one third of the Directors must retire at every annual general meeting and, if eligible, can stand for re-election. At the last annual general meeting, held on 31 July 2015, the following Directors were re-elected: Dr J Myers, Mr M Edge and Mrs T Mpofu. The Information pertaining to the directors of Econet Wireless Zimbabwe Limited is set out below.

20 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 5.7 DIRECTORATE

Name of Director ID/Passport Nationality Address Number Dr James Myers 710989272 American 232 Shady Hill Richardson, Texas, USA Mr Strive Masiyiwa 63-705953A68 Zimbabwean 58 Alpes Road, Vainona, Harare Mr Craig Fitzgerald 761100905 Zimbabwean 107 Katherine Street, Sandton, Johannesburg Mr Douglas Mboweni 54-025284J54 Zimbabwean 853 Riverton Road, Mandara, Harare Mr Roy Chimanikire 63-959740F71 Zimbabwean 5 Princecam Princess Road, Highlands, Harare Mrs Tracy Mpofu 08-169810C77 Zimbabwean 3 Dacomb Drive, Chisipite, Harare Mr Krison Chirairo 63-174220E12 Zimbabwean 25 Dover Road, Chisipite, Harare Ms Beatrice Mtetwa 63-677202Z13 Swazi 6th Chatsworth Road, Mount Pleasant, Harare Mrs Sherree Shereni 42-060998A42 Zimbabwean Topaz Building 30 The Chase, Emerald Hill, Oﬃce Park, Harare Mr Godfrey Gomwe 70-092220V70 Zimbabwean 1693 Axmisnster Drive, Dainfern 2055, South Africa Mr Martin Edge 500932905 British 76 Waterfall Avenue. Craighall 2196, South Africa

Proﬁle of each of the directors of Econet Wireless Zimbabwe Limited, are provide below:

Dr James Myers - Chairman Dr. Myers is a former Executive Vice President of South Western Bell International (SBC, Inc., now AT&T), the largest telecoms operators in the world. He has considerable experience in Africa, having led the team that acquired a controlling stake in MTN in the early nineties. He went on to lead a consortium of SBC and Malaysia Telekom that for a while controlled Telkom SA. Dr Myers also sits on the Board of EWG, the parent Company of Econet Wireless Zimbabwe Limited. He holds a BA in Mathematics from Texas A&M University, MA in Mathematics from University of Arizona and a PhD in Industrial Engineering/Operations Research from Texas Tech University.

Mr Strive Masiyiwa – Director Strive Masiyiwa is the founder of Econet Wireless Zimbabwe Limited and Executive Chairman of Econet Global Limited.

He serves on a number of international Boards, including the Rockefeller Foundation, the Africa Against Ebola Solidarity Trust, the Council on Foreign Relations’ Global Advisory Board, the Africa Progress Panel, the UN Secretary General’s Advisory Board for Sustainable Energy, Morehouse College and the Hilton Foundation’s Humanitarian Prize Jury. He is one of the founders of the global think tank, the Carbon War Room, and a founding member of the Global Business Coalition on Education.

Mr. Masiyiwa currently co-chairs the AU/WEF platform for investment in African agriculture, known as Grow Africa, and recently took over the Chairmanship of the Alliance for a Green Revolution in Africa (AGRA) from Koﬁ Annan. In 2012, Mr. Masiyiwa addressed leaders at the Camp David G-8 Summit on how to increase food production and end hunger in parts of Africa.

In 2014, the Chair of the African Union (AU), Dr Nkosazana Dlamini-Zuma, asked Masiyiwa to help mobilise resources for Africa’s response to the EBOLA outbreak. Together with other business leaders, he set up the ﬁrst ever Pan African fund raising campaign known as the Africa Against Ebola Solidarity Fund.

In 2014 Mr. Masiyiwa was selected by CNN Fortune Magazine as one of “the world’s 50 greatest leaders” whilst Forbes Magazine named him amongst the “10 Most Powerful Men in Africa” list for 2015.

As a philanthropist, Strive Masiyiwa and his wife Tsitsi Masiyiwa, are members of the Giving Pledge and ﬁnance the Higher Life Foundation, which provides scholarships to over 42,000 African orphans.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 21 5.7 DIRECTORATE CONTINUED

Mr Douglas Mboweni - Chief Executive Officer Douglas joined Econet (Pvt) Ltd in 1996. He was part of the team that launched the Mascom Wireless network in Botswana and Econet Wireless Nigeria (EWN) in Nigeria. He assumed various positions in Econet Wireless International before his appointment as Chief Executive Officer of Econet (Pvt) Ltd in March 2002. Among other qualifications, Douglas holds a Masters in Business Leadership (UNISA) and a BSc Maths and Computer Science degree from the University of Zimbabwe (UZ).

Mr Roy Chimanikire Roy joined the Group in 2009 from Deloitte, where he was a Partner. He is a Chartered Accountant (Zimbabwe) and is an Immediate Past President of the Institute of Chartered Accountants of Zimbabwe. He was appointed to the Board in February 2016 as the Group’s Finance Director.

Mr Krison Chirairo – Executive Director Mr. Chirairo joined the Group in 1998. He was appointed to the Board in February 2007. He has an MBA and is a fellow member of both the Chartered Institute of Management Accountants and the Institute of Chartered Secretaries and Administrators. He also heads some of the Company’s subsidiaries.

Mr Craig Fitzgerald - Non-Executive Director Craig Fitzgerald is the former Group Chief Executive Officer of Econet Global Limited. He joined Econet Global Limited as Chief Financial Officer in 2000. In this position Craig was responsible for financial reporting as well as all Corporate Finance and Merger & Acquisition activity for the Group. Craig was appointed Econet Group Chief Executive Officer in 2009. Craig is a Chartered Accountant, and holds a Corporate Finance qualification issued by the ICAEW.

Mr Godfrey Gomwe - Non-Executive Director Godfrey, a businessman, has extensive experience as an executive in metals and mining industries. He is the former Chief Executive Oﬃcer of Anglo American plc.’s global Thermal Coal business, whose responsibilities included oversight over Anglo’s Manganese interests in the joint venture with BHP. Previously Executive Director of Anglo American South Africa until August 2012, his career included roles as Head of Group Business Development, Africa, Finance Director and Chief Operating Oﬃcer of Anglo American South Africa. Previously, Godfrey was Chairman and Chief Executive of Anglo American Zimbabwe Limited. He also served on a number of Anglo American Operating Boards and Executive Committees including Kumba Iron Ore, Anglo American Platinum, Highveld Steel & Vanadium and Mondi South Africa, the latter two in the capacity of Chairman. Prior to joining Anglo American in 1999, Godfrey held many Leadership positions and directorships in listed and unlisted companies.

Godfrey is currently non- executive Chairman of Tshikululu Social Investments NPC and also sits on the Boards of AECI Limited and Thebe Investment Corporation Pty Ltd.

He is past President of Institute of Chartered Accountants of Zimbabwe, past Senior Vice-President of the Chamber of Mines of Zimbabwe in addition to serving on the Executive Council of the Chamber of Mines of South Africa.

Godfrey is a Chartered Accountant (Zimbabwe) who holds a Master’s degree in Business Leadership, from the University of South Africa(Unisa) as well as a Bachelor of Accountancy (Honours) Degree from the University of Zimbabwe (UZ).

Mrs Sherree Gladys Shereni - Non-Executive Director Sherree brings a wealth of expertise from The Coca-Cola Company which she joined in 2002 and has gained experience in public aﬀairs and communication, managing functions in eight countries across Central Africa. She was also Chairperson of the Women’s Leadership Council for the 39-country Coca-Coca Central, East and West Africa Business Unit. As Program Director of The Coca- Cola Africa Foundation, she was responsible for formulating community intervention strategies and managing implementation of over 200 projects by 15 international partners of The Coca -Cola Africa Foundation across the continent. She joined The Coca-Cola Company in October 2002. She has previously held senior positions at the Reserve Bank of Zimbabwe.

She holds a Bachelor of Science (Economics) Hons Degree (UZ), a Diploma in Business Administration (University of Manchester, UK), leadership training from The Coca-Cola Company and a host of other top qualiﬁcations, among them from, the Bank of England’s Centre for Central Banking Studies; the University of Pennsylvania’s Wharton International Housing Finance School, the International Monetary Fund Institute, the World Bank, and the Macro-Economic and Finance Management Institute.

22 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY Mrs Tracy Mpofu - Non-Executive Director Tracy joined Econet in February 2001 as Finance Director from Coca-Cola Central Africa, where she occupied the positions of Regional Finance Manager, Region & Budget Planning Manager and Regional Finance Director, responsible for all accounting functions for the region of 10 countries. Before then Tracy worked for Ernst & Young and the Comptroller and Auditor-General. She holds a Bachelor of Accountancy Degree and an MBA, both from the University of Zimbabwe. Tracy is a Chartered Accountant and a Chartered Management Accountant.

Ms Beatrice Mtetwa - Non-Executive Director Beatrice is one of Zimbabwe’s most recognised lawyers, and brings over two decades’ worth of legal experience to the Group. She is a partner at Mtetwa and Nyambirai Legal Practitioners, and is a past president of the Law Society of Zimbabwe.

Mr Martin Edge -Non-Executive Director Martin brings a wealth of experience gained from a financial career focused on both Africa and the telecommunications sector. Martin has practiced as a corporate finance advisor since 1985, working in London and Johannesburg. Martin has advised on some of the largest corporate finance transactions in Africa and served on many private Company Boards in Africa. Martin graduated with an Honours Degree in PPE from the University of Oxford, and is a UK Chartered Accountant.

5.8 STATEMENT OF INDEBTEDNESS

5.8.1 Borrowing Powers In terms of the existing Articles of Association, the Directors shall be entitled to exercise all the powers of the Company including , to borrow money and to mortgage or change all or any of its undertaking, property, assets (present and future) and uncalled capital, and, subject to the provisions of the statutes, to create and issue Debenture and other loan stock, and to borrow from time to time, to secure payment for the purpose of the Company and Debentures and other securities, whether outright as collateral security for any debt, liability or obligation of the Company or of any third party. Provided that the amount of the loan liabilities outstanding at any one time shall not, without the authority of an ordinary resolution of the members, exceed two hundred percent of the aggregate of: a) The issued share capital and share premium b) The total of distributable and non-distributable reserves.

As at the last Practicable Date, the Company had not exceeded its borrowing limits.

5.8.2 Borrowings Details of these Agreements are set out in the schedule “The Company Loan Obligations” on section 2.3.6.

All other contracts were entered into in the normal course of business.

5.8.3 Solvency, Liquidity and working capital statement The Directors are of the opinion that the working capital (including the amount to be raised in pursuance of this issue) is adequate for the purposes of the business of the Company and of its subsidiaries for at least the next 12 months.

5.9 LITIGATION

The Directors of the Company hereby confirm that they aware of legal proceedings involving the Company. However, it is the opinion of the Company’s lawyers that although the amounts involved in some of the legal cases are significant, the Company’s prospects of success are good and it is highly unlikely that the cases’ outcome will have a material or adverse effect on the Capital Raise contemplated in this Circular or on the prospects of the Company at large.

The Company is regularly subject to an evaluation by tax authorities on its direct and indirect tax ﬁlings. The consequence of such reviews is that disagreements can arise with tax authorities over the interpretation or application of certain tax rules applicable to the Company’s business. Such disagreements may not necessarily be resolved in a manner that is favourable to the Company. Additionally, the resolution of the disputes could result in an obligation to the Company.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 23 5.10 SIGNIFICANT CONTRACTS

Save for the underwriting agreement between Econet Global Limited and the Company, dated 21 December 2016, no material contracts have been entered into by the Company or its subsidiaries, other than in the normal course of business.

5.11 MATERIAL CHANGES

Save as disclosed in this Circular, there have been no material changes in the ﬁnancial or trading position of the Company since the last publication date of its Full Year Financial Results.

5.12 DIRECTORS INTERESTS IN SHARES

As at 29 February 2016, there were no outstanding share options granted to the Directors. At that date, the following Directors held directly and indirectly the following number of ordinary shares in the Company.

Name of Director Total Dr James Myers 20,851 Mr Strive Masiyiwa* 13,277 Mr Craig Fitzgerald 10,699,010 Mr Douglas Mboweni 7,014,684 Mrs Tracy Mpofu 10,380,580 Mr Krison Chirairo 4,080 Ms Beatrice Mtetwa - Mrs Sherree Shereni 2,200 Mr Godfrey Gomwe - Mr Martin Edge - Mr Roy Chimanikire - Total 28,134,682

*Mr. S.T. Masiyiwa is a benefcial shareholder of Econet Global Limited. Econet Global Limited holds directly or indirectly 630,673,303 shares (2015: 630 579 551 shares) in Econet Wireless Zimbabwe Limited.

5.13 DIRECTORS INTERESTS IN THE RIGHTS OFFER

Directors of Econet Wireless Zimbabwe Limited who have shares in the Company are as indicated in section 5.12 above. Like all the shareholders in Econet Wireless Zimbabwe Limited they will be oﬀered shares under this Rights Oﬀer in the Company pro-rata to their current shareholding.

5.14 DIRECTORS INTERESTS  OTHER

Save as disclosed in this Document, neither the Directors of Econet Wireless Zimbabwe Limited nor any member of their immediate families nor any person acting in concert with the Company, controls or is interested, beneﬁcially or otherwise, in any Econet Wireless Zimbabwe Limited Shares.

24 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART VI: INDEPENDENT FINANCIAL ADVISORS’ REPORT

Reliance Restricted

The Directors Econet Wireless Limited Econet Park 2 Old Mutare Road Msasa Harare

17 January 2017

Dear Messrs,

Independent Financial Advisor report on the Proposed Capital Raise by Econet Wireless Zimbabwe Limited (“Econet Wireless”) through a Rights Oﬀer to members of shares at a subscription price of 5.00 US Cents per share, and each of which shall be linked to a redeemable 5% coupon Debenture with a subscription price of 4.665 US Cents each.

This letter is prepared for the purpose of inclusion in the circular to shareholders of Econet Wireless, to be dated 17 January 2017 (“Circular”). Words and phrases used in this letter shall have the same meaning as ascribed to them in the Circular.

Introduction

The Directors of Econet Wireless wish to raise US$130 million through an oﬀer to members of the Company. The Board will oﬀer shareholders of the Company shares at a subscription price of 5.00 US cents each, and each share shall be linked to a redeemable Debenture with a subscription value of 4.665 cents each. The Debentures shall be redeemable at 6.252 US cents at the end of six years from the date of issue, or earlier at the discretion of the Board.

Econet Wireless has two classes of shares, ordinary and class A shares. Each class of shareholders will be entitled to follow their rights pro- rata to their existing shareholdings. If a shareholder decides not to follow their rights, the Rights Oﬀer shall be renounceable in terms of ZSE listings requirements. The Company shall not accept local payments as these are required to be made oﬀshore into a designated account. Full details of the Proposed Capital Raise are contained in the Circular.

Scope

EY has been retained by the Directors of Econet Wireless to provide an independent opinion as to the fairness and reasonableness of the terms of the Capital Raise in terms of Schedule 5 (Independent fairness opinions) of the ZSE Listings Requirements.

Deﬁnition of fairness and reasonableness for the purposes of our opinion

For the purposes of our opinion, “fairness” is based primarily on quantitative factors. Therefore, the price would be considered fair to Shareholders if the Capital Raise is oﬀered to all shareholders on the same basis.

“Reasonableness” is based primarily on qualitative factors such as sensibility or appropriateness to the given situation.

Our approach in considering the Proposed Capital Raise

In considering the price and terms, we took into consideration:

• The rationale for the Capital Raise; • Potential dilution eﬀect of the Capital Raise; • Prevailing economic and market conditions; • The impact of various risk factors such as country and liquidity risks; • An assessment of share price trends; • Underwriting arrangements; • Principal terms of the Capital Raise, • the terms and conditions of relevant loan and guarantee arrangements; • The acquittal of Econet Wireless’s independent directors of their responsibilities to the aﬀected shareholders; and • General compliance with ZSE Independent Financial Advisor related Listing Requirements to changes in control and related party transactions.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 25 Information utilised

In the course of our analysis, we relied upon ﬁnancial and other information, including prospective ﬁnancial information, obtained from Econet Wireless management, together with industry-related and other information in the public domain. Our conclusion is dependent on such information being complete and accurate in all material respects.

The principal sources of information used in formulating our opinion regarding the terms and conditions of the oﬀer include:

• The draft Circular to Shareholders dated 17 January 2017 with the terms and conditions of the offer; • Representations and assumptions made available by, and discussions held with, the representatives of Econet Wireless’ management; • Certain agreements relating to loan financing and guarantees; • Econet unaudited results for the half year ended 31 August 2016 • Econet audited results for the year ended 29 February 2016 • Econet loan balances and repayment schedule as at 05 November 2016 • Board presentation for the proposed rights offer; • A document entitled “Zimbabwe Guarantee Mandate Agreement”, together with its addendum, which outlines the terms of the loans guarantee; • Discussions with the Lead advisors of Econet Wireless; • Rights offer valuation report prepared by TN Financial Services (Private) Limited (the lead financial advisors); • Share prices, market capitalisations and ZSE volumes from 30 November 2015 to 30 November 2016 as captured by Standard & Poor’s CapitalIQ; and • Various analysts’ reports.

Where practical, we have corroborated the reasonableness of the information provided to us for the purpose of our opinion, obtained through discussions with the representatives of the management of Econet Wireless.

We have relied upon without independent veriﬁcation, the accuracy and completeness of the information provided to us whether in writing or obtained in discussions, and we have not assumed and we do not assume any responsibility or liability therefore.

In addition, we have placed reliance upon the Directors’ commercial assessment of the prospects of Econet Wireless after the Capital Raise, as disclosed in the circular for the proposed Rights Oﬀer.

We have further assumed that:

• In legal proceedings involving Econet Wireless, the Company’sprocpects of success are good and the Company’s lawyers are of the opinion that it is highly unlikely that the cases’ out comes will have a material or adverse eﬀect on the Company; • As advised by the Legal Practitioners and contained in the circular, that the Company’s prospects of success in the disclosed litigation regarding disputes with the revenue authorities are good; and • there are no other contingencies that could materially aﬀect the value of Econet Wireless Zimbabwe Limited.

Procedures performed

In arriving at our opinion, we have undertaken the following procedures in evaluating the fairness of the Price:

• Setting up initial meetings with representatives of Econet Wireless, to agree the terms and scope of our mandate; • Obtaining an understanding of Econet Wireless through: • discussions with the Econet Wireless management representatives; • an analysis of publicly available historical and forecast financial information; • a review of recent reports and/or comments by independent investment analysts and other market commentators; and • a review of other publicly available information; • Having meetings with the Lead Advisors to gain an understating of the Proposed Capital Raise terms and conditions; • Considering whether (and what quantum) of liquidity and/or marketability discounts may be applicable to the Econet Wireless shares for the specifics of the Proposed Capital Raise; • Considering the theoretical ex-rights price; • Reviewing the terms and conditions relating to the Proposed Capital Raise outlined in the and circular; • Reviewing information relating to loans and guarantees; • Considering other capital raise options available to Econet Wireless; • Interviews with independent directors; • Interviews with Econet Wireless legal advisors to verify the legal advice given on this Capital Raise; • Considering any other/qualitative aspects which we believe are of importance; and • Analysing the possible dilutive effect if the Proposed Capital Raise.

We did not carry out an independent valuation of Econet Wireless. We reviewed the valuation computations carried out by the Lead Advisor and carried out corroborative computations. We note that valuations by their nature are subjective, and we have considered such subjective factors in our corroborative computations. Based on the results of the procedures listed above, we determined the fairness and reasonableness of the pricing of the Proposed Capital Raise as it concerns Shareholders. We believe that the above considerations justify the conclusion outlined below.

26 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY Principal factors and reasons considered

Rationale for the Capital Raise

As stated in the Chairman’s Letter to Shareholders dated 17 January 2017, the shortage of foreign currency in bank nostro accounts has made it difficult for the Company to make payments to lenders outside of Zimbabwe. To avoid defaulting on its international obligations, the Company intends to raise foreign currency from its members through a rights offer. The shortage of foreign currency in the market has been confirmed by the Reserve Bank of Zimbabwe and various commercial banks operating in Zimbabwe.

Existing loan obligations

As at 5 November, loan obligations were US$158million of which US$32million is payable within four months.

Rights Oﬀer shares linked to an issue of redeemable Debentures

The inclusion of the Debentures in the capital raise reduces the dilutive eﬀect for those members who do not follow their rights and allows shareholders a guaranteed return, which is an incentive for them to follow their rights.

Overview of the share market in Zimbabwe

The Company would like to convince members to provide foreign currency. We therefore considered performance of the ZSE from a foreign investor perspective, the risk that foreign investors would be taking and alternative investment options for foreign investors. The oﬀer to foreign shareholders, therefore, has to be compelling in order for them to follow their rights.

Financing alternatives

We have been advised by representatives of management that other financing alternatives were discussed but not considered to be in the best interests of the Company and its shareholders given the liquidity shortage is Zimbabwe as well as cost of such finance when the Company is faced with the risk of default. Any financing alternative that requires payment in foreign currency renders such a financing option uncertain.

Rights issue price discount

We considered amongst other things the eﬀect of the Linked Debenture issue, the shortage of nostro account balances in the country, the eﬀect of dilution, recent share price trends, the cost of debt, loan covenants and underwriting arrangements.

Our indicative computations took into account factors such as: • 30 day, 60 day and 90 day volume weighted average prices; • Equity risk premium according to Damodaran; • Liquidity challenges and the shortage of foreign currency in Zimbabwe; • Discounted value of the Debenture; and • Expected discounts on rights issues.

Using our indicative calculations, we have calculated discount levels of between 39% and 47% of volume weighted average prices. It is normal for rights issues to be carried out at a discount and we note from our analysis of discounts oﬀered in recent rights issues in Zimbabwe and South Africa, there has been a wide range on the level of discount.

Dilutive eﬀect

Shareholders who take up their pro rata entitlement in full under the Rights Issue will not suﬀer any dilution to their interests on the Company. The new shares will rank pari pasu with the existing ones.

Related Party

We considered the relationship between EGL and Econet Wireless in terms of the ZSE Listing Requirements. These rules state that the following are not regarded as related party transactions: • Issues of new securities pursuant to an opportunity which is made available to all shareholders on the same terms or pursuant to the exercise of subscription rights approved by shareholders in a general meeting. • The transaction is an underwriting by the related party of all or part of an issue of securities by the listed Company (or any of its subsidiaries) and the consideration to be paid by the listed Company (or any of its subsidiaries) in respect of such underwriting is no more than the usual commercial underwriting consideration and is the same as that to be paid to the other underwriters

In addition, we considered the terms of the guarantee agreement with EGL which terms are not aﬀected by the Capital Raise.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 27 Opinion

We have considered the terms of the Proposed Capital Raise and reviewed various scenarios. Based upon and subject to the conditions set out herein, we are of the opinion that the terms of the Proposed Rights Oﬀer are fair and reasonable to Shareholders.

This opinion does not purport to cater for each individual shareholder’s circumstances and/or risk proﬁle, but rather that of the general body of Shareholders taken as a whole. Each shareholder’s decision will be inﬂuenced by such shareholder’s particular circumstances and, accordingly, Shareholders should consult with an independent advisor if they are in any doubt as to the merits or otherwise of the Proposed Capital Raise.

Use of this opinion

This opinion is provided solely for the use of the Board and Shareholders in connection with and for the purpose of their consideration of the Proposed Capital Raise.

This opinion does not purport to contain all the information required for an investment or disposal decision, and the content may not be relied upon by any third party.

This opinion shall not, in whole or in part, be disclosed, reproduced, disseminated, quoted, summarised or referred to at any time, in any manner or for any purpose, save for inclusion in this Circular, without the prior consent of EY.

Limiting conditions

We have relied upon the accuracy of the information used by us in deriving our opinion albeit that, where practicable, we have corroborated the reasonableness of such information through, amongst other things, reference to work performed by independent third party/ies, historic precedent or our own knowledge and understanding. While our work has involved an analysis of the annual ﬁnancial statements and other information provided to us, our engagement does not constitute, nor does it include, an audit conducted in accordance with generally accepted auditing standards. Accordingly, we assume no responsibility and make no representations with respect to the accuracy of any information provided to us in respect of Econet Wireless.

We were not availed any forecast information relating to Econet Wireless.

The opinion expressed herein is necessarily based upon the information available to us, the ﬁnancial, regulatory, securities market and other conditions and circumstances existing and disclosed to us as at the date hereof. We have assumed that all conditions precedent in the Capital Raise agreements, including any material regulatory and other approvals required in connection with the proposed Capital Raise have been or will be properly fulﬁlled or obtained.

Subsequent developments may aﬀect our opinion. However, we are under no obligation to update, revise or re-aﬃrm such.

Independence

We have been retained as an independent advisor to the independent directors and we will receive a fixed fee for the services provided in connection herewith, which fee is payable upon delivery of this opinion. We confirm that, other than the aforementioned, we have no interest, direct or indirect, beneficial or non-beneficial, in Econet Wireless or in the success or failure of the proposed offer which forms the subject matter hereof.

Sincerely,

Ernst & Young Associates (Private) Limited

28 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART VII: ACCOUNTANTS’ REPORT ON THE HISTORICAL FINANCIAL INFORMATION OF ECONET WIRELESS ZIMBABWE

P O Box 267 Deloitte & Touche Harare West Block Zimbabwe Borrowdale Ofﬁce Park Borrowdale Road

Harare Tel: +263 (0)8677 000261 +263 (0)8644 041005 Fax: +263 (0)4 852130 www.deloitte.com 17 January 2017

The Directors Econet Wireless Zimbabwe Limited 2 Old Mutare Road Msasa Harare

Dear Messrs,

ACCOUNTANT’S REPORT ON THE HISTORICAL FINANCIAL INFORMATION OF ECONET WIRELESS ZIMBABWE LIMITED FOR THE YEARS ENDED 29 FEBRUARY 2012 TO 29 FEBRUARY 2016

Introduction The Directors of Econet Wireless Zimbabwe Limited are proposing a capital raise of approximately US$130 million (the Capital raise) by Econet Wireless Zimbabwe Limited (hereafter referred to as Econet) through an oﬀer to members of the Company, pro rata to their respective existing shareholdings of 1,082,088,944 ordinary shares plus 263,050,614 Class A Shares at a subscription price of 5.00 US Cents each on the basis of circa 82 ordinary share for every 100 shares already held. Each share shall be linked to a redeemable accrual Debenture at coupon rate of 5% with a subscription price of 4.665 US Cents each (1,345,139,558 Debentures). The amount due on both the shares and the Linked Debentures shall be payable in full on acceptance of the oﬀer.

Responsibility The Directors are responsible for the preparation of the circular to which this report relates and the information contained therein.

Our report is prepared in terms of the Listing Requirements of the Zimbabwe Stock Exchange (“ZSE”) for the purposes of inclusion in the Circular to Econet shareholders dated 17 January 2017. We do not accept any responsibilities for any reports given by us on any ﬁnancial information to any third parties who may choose to rely on the reports.

In terms of the ZSE Listing Requirements we refer below to Econet’s annual ﬁnancial statements for the years ended 29 February 2012 to 29 February 2016, set out on pages 34 to 39 in the Circular (as extracts). We were appointed as the auditors for the ﬁnancial period ended 29 February 2016 and have reported in accordance with guidance on standard audit reports as issued by the Public Accountants and Auditors Board. Prior to our appointment, the auditors for Econet were Ernst & Young Chartered Accountants (Zimbabwe).

Scope of audits of annual financial statements The audits were conducted in accordance with International Standards on Auditing. Those standards require that the auditor comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

Prior year audited financial statements Independent Auditors Ernst & Young Chartered Accountants (Zimbabwe) reported on the annual financial statements for the years ended 29 February 2012 to 28 February 2015, and the extracts of their audit opinions for those financial periods are as follows:

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 29 Audited financial statements for the year ended 29 February 2012 In their opinion, the financial statements presented fairly, in all material respects, the Company and consolidated financial position of Econet Wireless Zimbabwe Limited as at 29 February 2012, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

Audited financial statements for the year ended 28 February 2013 In their opinion, the financial statements presented fairly, in all material respects, the Company and consolidated financial position of Econet Wireless Zimbabwe Limited as at 28 February 2013 and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

Audited financial statements for the year ended 28 February 2014 In their opinion, the financial statements presented fairly, in all material respects, the Company and consolidated financial position of Econet Wireless Zimbabwe Limited as at 28 February 2014 and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

Audited financial statements for the year ended 28 February 2015 In their opinion, the financial statements presented fairly, in all material respects, the Company and consolidated financial position of Econet Wireless Zimbabwe Limited as at 28 February 2015 and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

As mentioned above, we were appointed as the auditors for the ﬁnancial period ended 29 February 2016 and our opinion was as shown below:

Audited financial statements for the year ended 29 February 2016 In our report, we stated that in our opinion the financial statements presented fairly, in all material respects, the financial position of the Group as at 29 February 2016 and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards and in the manner required by the Companies Act (Chapter 24:03).

30 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY INDEPENDENT AUDITORS’ REVIEW REPORT ON CONSOLIDATED INTERIM FINANCIAL INFORMATION OF ECONET WIRELESS ZIMBABWE LIMITED.

We have reviewed the accompanying consolidated interim financial information of Econet Wireless Zimbabwe Limited and its subsidiaries (“the Company”), comprising the consolidated condensed statement of financial position as of 31 August 2016 and the consolidated condensed statement of comprehensive income, consolidated condensed statement of changes in equity and consolidated condensed statement of cash flows for the six months then ended.

Directors’ responsibility for the interim financial statements The directors are responsible for the preparation and presentation of this interim financial information in accordance with International Financial Reporting Standard (IAS 34), ‘Interim Financial Reporting’ and the requirements of the Zimbabwe Companies Act (Chapter 24:03), and for such internal control as the directors determine is necessary to enable the preparation of interim financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s responsibility Our responsibility is to express a conclusion on these consolidated interim financial statements based on our review. We conducted our review in accordance with International Standard on Review Engagements (ISRE) 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor of the Entity’. This standard requires us to conclude whether anything has come to our attention that causes us to believe that the interim financial statements are not prepared in all material respects in accordance with the applicable financial reporting framework. This standard also requires us to comply with relevant ethical requirements.

A review of interim financial statements in accordance with this standard consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable the auditor to obtain assurance that the auditor would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

We believe that the evidence we have obtained in our review is suﬃcient and appropriate to provide a basis for our conclusion.

Conclusion Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim ﬁnancial information of the Group for the six months ended 31 August 2016 are not prepared, in all material respects, in accordance with International Financial Reporting Standard (IAS 34), ‘Interim Financial Reporting’ and the requirements of the Zimbabwe Companies Act (Chapter 24:03).

Key ﬁnancial information as required by Section 8.12 as extracted from historical audited annual reports

29 Feb 12 28 Feb 13 28 Feb 14 28 Feb 15 29 Feb 16 Earnings per share (US cents) 9.8 9.0 7.6 4.5 2.6 Dividend per share (US cents) 2.97 n/a 1.29 0.92 0.91 Net assets per share (US cents) 22.31 30.05 36.81 40.57 40.36

Basis of calculation of ﬁnancial information

Earnings per share Earnings per share is calculated in accordance with the requirements of IFRS as the earnings attributable to ordinary equity holders divided by the weighted average number of shares in issue.

Dividend per share Dividends per share is calculated as the total dividend divided by the number of shares in issue at the time of declaration of the dividend.

Net assets per share Net assets per share is calculated by dividing the net assets by the number of shares in issue at each respective balance sheet date as adjusted for the eﬀects of share splits, share consolidations, rights issues and capitalisation issues.

Corporate information Corporate information for the Econet Wireless Zimbabwe Limited Group has been shown per Appendix VII - A.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 31 Material contingent liabilities and commitments There are no material changes to contingencies from those that were communicated in the last annual ﬁnancial statements.

Subsequent events The shortage of foreign currency in bank nostro accounts and the local shortage of cash that could be exported by banks to fund their nostro accounts has made it diﬃcult for the Company to make payments to its lenders outside Zimbabwe. Other than the matter noted above, there have been no signiﬁcant events after the reporting date. We continue to monitor the impact of the changing economic conditions on the business.

Scope As the purpose of the appended financial information as set out on pages 34 to 39 differs from the purpose of the financial statements prepared for members, the appended financial information is not intended to comply with the full presentation and disclosure requirements of the Companies Act (Chapter 24:03) and International Financial reporting Standards.

Our reporting shall not in any way constitute recommendations regarding the completion of the Capital Raise or the issue of the Circular to the Shareholders.

Yours faithfully

Deloitte & Touche Chartered Accountants (Zimbabwe) Harare, Zimbabwe

32 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY APPENDIX VII – A: CORPORATE INFORMATION

Name of Company Country of Incorporation Registration Number Econet Wireless Zimbabwe Limited Zimbabwe 7548/98

Companies in which Econet Wireless Zimbabwe Limited (the Company) has an eﬀective equity interest of 20% or more, which have any material value to the Company are as follows:

Name of Company Equity interest Econet Wireless (Private) Limited 100% Transaction Payment Solutions (Private) Limited 100% Econet Wireless Capital Holdings (Private) Limited 100% Pentamed Investments (Private) Limited 100% Steward Bank Limited 100% Econet Life (Private) Limited 85% Steward Health (Private) Limited 100% Data Control and Systems (1996) t/a Liquid Telecom Zimbabwe 51%

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 33 PART VIII: HISTORICAL FINANCIAL INFORMATION OF ECONET WIRELESS ZIMBABWE LIMITED

Below are extracts from the audited financial statements of Econet Wireless for the five years ended 28 February 2012 to 29 February 2016 and the half year ended 31 August 2016. The information in this paragraph should be read in conjunction with PART VI – Report of the Independent Reporting Accountants on the historical financial information of Econet Wireless Zimbabwe Limited.

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME EXTRACTED FROM ECONET WIRELESS ZIMBABWE LIMITED FINANCIAL STATEMENTS Audited Audited Audited Audited Audited Reviewed Full Year Full Year Full Year Full Year Full Year Half Year (All amounts in US$ 000) 29 Feb. 2012 28 Feb. 2013 28 Feb. 2014 28 Feb. 2015 29 Feb. 2016 31 Aug. 2016 Revenue 611,116 695,791 752,678 746,183 640,989 301,513 EBITDA 293,724 302,413 332,174 285,644 238,420 105,854 Depreciation, amortisation & impairment (46,497) (71,563) (101,724) (126,289) (136,556) (63,753) Profit from operations 247,227 230,850 230,450 159,355 101,864 42,101 Finance income 2,105 2,653 596 1,065 2,827 506 Finance costs (10,202) (28,600) (37,037) (37,076) (36,230) (15,225) Profit before taxation 239,130 204,903 194,009 123,344 68,461 27,382 Taxation (73,389) (64,965) (74,612) (53,136) (28,261) (12,417) Profit for the period 165,741 139,938 119,397 70,208 40,200 14,965 Other comprehensive income Other comprehensive (loss)/income net of tax (4,423) (774) (106) 208 (723) (231) Total comprehensive income for the period 161,318 139,164 119,291 70,416 39,477 14,734 Profit for the period attributable to:- Equity holders of the parent 165,734 139,593 119,282 70,256 40,363 15,283 Non-controlling interest 7 345 115 (49) (163) (318) Profit for the period 165,741 139,938 119,397 70,209 40,200 14,965 Total comprehensive income for the period attributable to:- Equity holders of the parent 161,311 138,819 119,176 70,465 39,640 15,052 Non-controlling interest 7 345 115 (49) (163) (318) Total comprehensive income for the period 161,318 139,164 119,291 70,416 39,477 14,734

Earnings per share Basic and diluted earnings per share (cents) 9.8 9.0 7.6 4.5 2.6 1.1 Number of shares in issue 1,715,542,020 1,640,021,430 1,640,021,430 1,640,021,430 1,640,021,430 1,640,021,430 Weighted average number of shares in issue 1,651,513,490 1,545,324,020 1,563,868,999 1,581,784,694 1,551,431,509 1,423,677,054

Dividend declared 50,696,670 - 20,029,762 14,787,251 12,940,042 - Outstanding shares 1,704,987,589 1,564,040,380 1,550,347,181 1,606,859,321 1,422,436,994 1,423,677,054 Dividend per share (USc) 2.97 n/a 1.29 0.92 0.91 n/a

34 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME REVIEW

Econet Wireless Zimbabwe Limited’s main line of business is the provision of telecommunications services and related value added services. The Company’s commitment to innovation has seen the business expanding into new areas and diversifying its services to boost revenue. Through its subsidiaries and associates, the Company introduced a number of new products over the years. The most signiﬁcant of these innovations relate to the investment in and growth of broadband data services as well as mobile ﬁnancial services such as EcoCash and EcoSure.

In line with Global trends, the local telecom industry is experiencing a decline in voice revenues. The decline in revenues observed between the ﬁnancial years 2014 (US$753 million) and 2016 (US$640 million) is a result of the regulatory price reductions on voice and SMS revenues, increased levies as well as the deterioration in the economic environment. Management anticipated this trend, hence over the years invested in new infrastructure and created a new innovation pipeline to create new revenue streams.

Whilst these new innovations have been able to mitigate against some revenue losses, they have lower margins compared to voice margins and cannot mitigate against charges such as depreciation and amortisation. The new revenue streams, however, contribute to overall proﬁtability in a meaningful way as they have been developed largely using the existing cost base.

The Company’s profit after tax declined from a peak of US$139 million in the 2013 financial year to US$39 million in the 2016 financial year. In an effort to survive and grow in an increasingly volatile and complex economic environment, the Company has increased its focus on cost optimisation over the years in order to protect margins and profitability. The decline in profit after tax is in spite of the growth in EcoCash and Data revenues as well as the aggressive cost containment measures implemented over the years.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 35 ECONET WIRELESS ZIMBABWE LIMITED FINANCIAL INFORMATION

CONSOLIDATED STATEMENT OF FINANCIAL POSITION EXTRACTED FROM ECONET WIRELESS ZIMBABWE LIMITED FINANCIAL STATEMENTS Audited Audited Audited Audited Audited Reviewed 29 Feb. 2012 28 Feb. 2013 28 Feb. 28 Feb. 29 Feb. 31 Aug. (All amounts in US$ 000) 2014 2015 2016 2016 ASSETS Property, plant and equipment 605,847 690,806 734,664 736,320 695,555 652,333 Intangible assets and goodwill 7,991 15,583 149,486 146,867 139,315 133,443 Other non-current assets 9,385 15,013 24,425 33,984 44,751 48,611 Deferred taxation 2,686 5,643 19,238 19,001 10,897 9,136 Financial instruments - long term 18,854 12,906 15,065 76,983 65,625 55,019 Financial instruments - short term 155,609 260,715 204,884 183,982 228,396 285,022 Other current assets 12,055 14,444 25,902 59,354 12,365 6,766 Total assets 812,427 1,015,110 1,173,664 1,256,491 1,196,904 1,190,330

EQUITY AND LIABILITIES EQUITY Share capital and share premium 33,125 35,698 37,449 40,764 40,764 40,764 Retained earnings 345,478 453,138 561,883 614,112 614,225 615,637 Other reserves 1,343 569 463 5,894 2,546 3,246 Attributable to equity holders of the parent 379,946 489,405 599,795 660,770 657,535 659,647 Non-controlling interests 2,847 3,478 3,924 4,525 4,362 4,044 Total equity 382,793 492,883 603,719 665,295 661,897 663,691

LIABILITIES Deferred taxation 70,667 85,493 109,838 120,459 112,221 103,387 Other non-current liabilities - - - 1,386 3,487 3,190 Financial Instruments: Long-term interest-bearing debt 103,338 202,800 134,852 165,758 112,343 77,585 Short-term interest-bearing debt 145,800 61,771 105,428 98,176 110,735 103,609 Other ﬁnancial instruments - short term 97,017 155,222 188,352 175,129 165,389 210,068 Other current liabilities 12,812 16,941 31,475 30,288 30,832 28,800 Total liabilities 429,634 522,227 569,945 591,196 535,007 526,639 Total equity and liabilities 812,427 1,015,110 1,173,664 1,256,491 1,196,904 1,190,330

Net Asset Value (NAV) NAV (incl. intangible assets) 382,793 492,883 603,719 665,295 661,897 663,691 NAV (excl. intangible assets) 374,802 477,300 454,233 518,428 522,582 530,248 NAV per share (incl. intangible assets) (USc) 22.45 31.51 38.94 41.40 46.53 46.62 NAV per share (excl. intangible assets) (Usc) 21.98 30.52 29.30 32.26 36.74 37.24

36 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY STATEMENT OF CONSOLIDATED FINANCIAL POSITION REVIEW a) Property, plant & equipment, Intangible assets and Goodwill (US$785,776) Primary non-current assets relate to cellular network equipment and the cellular operating license. The ongoing liquidity challenges have hampered the Group’s investment eﬀorts. Consequently, the capital expenditure intensity has decreased from 16.6% to 5.1%.

Commitments for capital expenditure as at 31 August 2016 31 Aug. 2016 31 Aug. 2015 Authorised by the Directors and contracted US$6.1 million - Authorised by the Directors but not contracted US$31.4 million US$27.2 million

The capital expenditure is to be ﬁnanced out of the Group’s own resources and existing facilities b) Financial Instruments- short term assets (US$285,022) Financial instruments short term consist: - Inventories consist merchandise, spares, stationery and other inventories at net realisable value. - Trade receivables are non-interest bearing and are generally on terms of 30 to 90 days. - Loans and advances to bank customers c) Interest Bearing Borrowings (US$181,194) The Group secured loan facilities to fund the cellular network expansion. The Company and its subsidiaries were in compliance with all requirements arising from the multi-creditor facility as at 31 August 2016. d) Financial Instruments- short term liabilities (US$210,068) Trade payables and accruals principally comprise amounts outstanding for trade purchases and ongoing costs together with credit granted on equipment purchases. The average credit period on purchases is between 7 and 30 days.

Rights Oﬀer Circular considerations No dividends were paid out on any class of shares in FY 2016. The debtors and creditors do not include any accounts other than trade accounts; The provisions for doubtful debts are adequate. Adequate provision has been made for obsolete, damaged or defective goods and for supplies purchased at prices in excess of current market prices. Inter Company proﬁts in the group have been eliminated.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 37 ECONET WIRELESS ZIMBABWE LIMITED FINANCIAL INFORMATION

COMPANY STATEMENT OF FINANCIAL POSITION EXTRACTED FROM ECONET WIRELESS ZIMBABWE LIMITED AUDITED FINANCIAL STATEMENTS

Audited Audited Audited Audited Audited Reviewed 29 Feb. 28 Feb. 28 Feb. 28 Feb. 29 Feb. 31 Aug. (All amounts in US$ 000) 2012 2013 2014 2015 2016 2016 ASSETS Property, plant and equipment 631 630 623 623 623 623 Investment in subsidiaries 34,555 101,177 124,470 127,881 127,881 128,020 Interest in associated companies 6,144 14,061 20,768 29,816 39,332 43,192 Financial Instruments: Financial instruments - long term 2,786 2,921 2,252 1,886 1,886 1,886 Financial instruments - short term 4,434 9,447 17,178 4,798 4,864 29,228 Total assets 48,550 128,236 165,291 165,004 174,586 202,949

EQUITY AND LIABILITIES EQUITY Share capital and reserves 15,840 (3,389) (7,342) (12,655) (52,452) (62,164) Total equity 15,840 (3,389) (7,342) (12,655) (52,452) (62,164)

LIABILITIES Non-current ﬁnancial instruments - 128,313 154,110 177,243 226,207 240,093 Financial Instruments: Other ﬁnancial instruments - short term 32,710 3,312 2,137 416 831 450 Short-term interest-bearing debt - - 16,386 - - 18,544 Total liabilities 32,710 131,624 172,633 177,659 227,038 265,113 Total equity and liabilities 48,550 128,236 165,291 165,004 174,586 202,949

38 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY ECONET WIRELESS ZIMBABWE LIMITED FINANCIAL INFORMATION

CONSOLIDATED STATEMENT OF CASH FLOWS EXTRACTED FROM ECONET WIRELESS ZIMBABWE LIMITED AUDITED FINANCIAL STATEMENTS

Audited Audited Audited Audited Audited Reviewed 29 Feb. 28 Feb. 28 Feb. 28 Feb. 29 Feb. 31 Aug. (All amounts in US$ 000) 2012 2013 2014 2015 2016 2016 Cash generated from operations 315,327 216,177 401,086 226,962 244,681 130,227 Income tax paid (36,465) (53,097) (53,311) (51,421) (25,566) (16,336) Net cash generated from operations 278,862 163,080 347,775 175,541 219,116 113,891 Investing activities Acquisition of property, plant and equipment and intangible assets (216,014) (147,610) (281,326) (125,387) (82,848) (15,361) Acquisition of associate (20,000) Net cash inflow on acquisition of subsidiary 16,598 121 Net acquisition/ (disposal) of financial instruments 1,600 646 (2,117) (17,850) (8,984) 5,342 Net cash used in investing activities (214,414) (150,366) (283,443) (143,116) (91,832) (10,019) Cash flows from financing activities Financing costs paid (10,203) (33,360) (34,340) (36,594) (36,437) (12,214) Dividend paid (36,372) - - (29,815) (4,834) (7,093) Share buy-back (28,450) (22,109) (9,903) 34,721 (40,066) - Proceeds from borrowings 132,911 52,000 48,385 120,964 45,268 27,044 Repayment of borrowings (56,231) (31,808) (75,373) (97,793) (86,737) (68,190) Net cash flows from/(used in) financing activities 1,655 (35,277) (71,231) (8,517) (122,807) (60,453) Net increase/(decrease) in cash and cash equivalents 66,102 (22,563) (6,899) 23,908 4,476 43,419 Cash and cash equivalents at the beginning of the 95,239 year 34,691 100,793 78,230 71,331 99,715 Cash and cash equivalents as at end of period 100,793 78,230 71,331 95,239 99,716 143,134 Comprising: Short-term investments 8,751 65 - 875 520 - Bank balances and cash 92,042 78,165 71,331 94,364 99,195 143,134 Cash and cash equivalents as at end of period 100,793 78,230 71,331 95,239 99,716 143,134

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 39 PART IX: REPORTING ACCOUNTANTS’ REPORT ON THE UNAUDITED PRO-FORMA FINANCIAL INFORMATION OF ECONET WIRELESS ZIMBABWE AS AT 31 AUGUST 2016

P O Box 267 Deloitte & Touche Harare West Block Zimbabwe Borrowdale Ofﬁce Park Borrowdale Road

Harare Tel: +263 (0)8677 000261 +263 (0)8644 041005 Fax: +263 (0)4 852130 17 January 2017 www.deloitte.com

The Directors Econet Wireless Zimbabwe Limited 2 Old Mutare Road Msasa Harare

Dear Messrs,

REPORTING ACCOUNTANT’S REPORT ON THE UNAUDITED PRO-FORMA FINANCIAL INFORMATION OF ECONET WIRELESS ZIMBABWE LIMITED AS AT 31 AUGUST 2016

Introduction The Directors of Econet Wireless Zimbabwe Limited are proposing a capital raise of approximately US$130 million (the Capital raise) by Econet Wireless Zimbabwe Limited through an oﬀer to members of the Company, pro rata to their respective existing shareholdings of 1,082,088,944 ordinary shares plus 263,050,614 Class A Shares at a subscription price of 5.00 US Cents per share, and each of which shall be linked to a redeemable accrual Debenture with a subscription value of 4.665US Cents each. The amount due on both the shares and the Linked Debentures shall be payable in full on acceptance of the oﬀer.

The terms of the proposals or (“the capital raise”) are more fully described in the Circular to Shareholders dated 17 January 2017. A pro-forma statement of ﬁnancial position showing the impact of the Proposed Capital Raise to Econet Wireless Zimbabwe Limited (Econet), has been set out in PART X of this Circular.

Responsibility The Directors are solely responsible for the preparation of the unaudited pro-forma information to which this independent reporting accountant’s report relates. They are also responsible for the preparation of the information from which the unaudited financial information has been prepared. Our responsibility as independent reporting accountants is to form an opinion on the basis used to compile the unaudited pro-forma financial information. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the unaudited pro forma financial information beyond that owed to those to whom those reports were addressed at their dates of issue.

The Directors are responsible for the preparation of the circular to which this report relates and the ﬁnancial information contained therein. This report is prepared in terms of the Listing Requirements of the Zimbabwe Stock Exchange for the purpose of inclusion in the Circular to Shareholders dated 23 December 2016.

Unaudited Pro-forma Financial Information The pro-forma financial information has been prepared for illustrative purposes only to provide information demonstrating how the Capital Raise would have impacted on the financial position of Econet had the Proposed Capital Raise been undertaken on 31 August 2016. Because of its nature, the unaudited pro-forma financial information may not give a fair reflection of Econet’s financial position going forward.

Our work consisted primarily of reviewing the unaudited pro-forma ﬁnancial information, considering the evidence supporting the adjustments and discussing the unaudited pro-forma ﬁnancial information with directors. We were not involved in the independent examination of the underlying information.

Because the above procedures conducted by us do not constitute either an audit or a review performed in accordance with statements of International Standards on Auditing, we do not express assurance on the fair presentation of the unaudited pro forma ﬁnancial information. Had we conducted additional procedures, or had we performed an audit in accordance with the International Standards on Auditing, other matters might have come to our attention that would have been reported to you.

In a limited assurance engagement, the evidence- gathering procedures are more limited than for a reasonable assurance engagement and therefore less assurance is obtained than in a reasonable assurance engagement. We believe our evidence obtained is suﬃcient and appropriate to provide a basis for our conclusion.

Conclusion Based on our examination of the evidence obtained, nothing has come to our attention that causes us to believe that, in terms of section 8.3 of the ZSE Listing Requirements: • The pro forma ﬁnancial information has not been properly compiled on the basis stated; • Such basis is inconsistent with the accounting policies of the Company; and • The adjustments are not appropriate for the purposes of the pro forma information as disclosed.

Yours faithfully,

Deloitte & Touche Chartered Accountants (Zimbabwe) Harare, Zimbabwe

40 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART X: ECONET WIRELESS ZIMBABWE LIMITED PRO-FORMA STATEMENT OF FINANCIAL POSITION

UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the half year ended 31 August 2016

Audited Unaudited 31 August 2016 Efect of Proposed Capital Raise 31 August 2015 Pre-Capital Raise Note 1 Note 2 Note 3 Note 4 Post-Capital Raise (All amounts in US$ 000) 31 August 2016 29 February 2016 ASSETS Property, plant and equipment, intangible assets and goodwill 785,776 785,776 Other non-current assets 48,611 48,611 Deferred taxation 9,136 9,136 Financial instruments - long term 55,019 55,019 Financial instruments - short term 141,888 141,888 Other current assets 6,766 6,766 Cash and cash equivalents 143,134 67,257 62,751 (4,030) (130,008) 139,104 Total assets 1,190,330 1,186,300

EQUITY AND LIABILITIES EQUITY Share capital 1,640 1,345 2,985 Share premium 39,124 65,912 (2,085) 102,951 Retained earnings 615,637 (1,038) 614,599 Other reserves 3,246 3,246 Attributable to equity holders of the parent 659,647 723,781 Non-controlling interests 4,044 4,044 Total equity 663,691 727,825

LIABILITIES Deferred taxation 103,387 1,038 104,425 Other non-current liabilities 3,190 3,190 Financial Instruments: - Long-term interest-bearing debt 77,585 62,751 (1,945) (26,399) 111,992 Short-term interest-bearing debt 103,609 (103,609) - Other ﬁnancial instruments - short term 210,068 210,068 Other current liabilities 28,800 28,800 Total liabilities 526,639 458,475

Total equity and liabilities 1,190,330 1,186,300

Notes to the un-Audited Consolidated Pro-forma Statement of Financial Position Note 1 Being shares issued under the rights issue. Note 2 Debentures issued. Note 3 Being advisory fees and regulatory costs. Note 4 Being repayment of borrowings funded by Debenture & rights issue proceeds.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 41 PART XI: TABLE OF ENTITLEMENT FOR ECONET WIRELESS ZIMBABWE LIMITED SHAREHOLDERS

Set out below is the table of entitlement of Econet Wireless Zimbabwe Limited Shareholders to Rights Oﬀer and Debenture Shares, based on the subscription for listed securities and for USD cash.

Table of entitlements for subscription in USD cash. For subscription in USD cash, the shares are oﬀered at a price of US$0.05 each payable in full on acceptance on the basis of circa 82 new Rights Oﬀer Shares for every 100 ordinary share held.

Shares currently Subscription price Subscription price held by At 5 US Cents per Indivisibly Linked At 5 US cents per Total Amount Shareholder Rights Oﬀer Shares Share Debentures Debenture (US$)

100 82 US$4 82 US$4 US$8 500 410 US$21 410 US$19 US$40 1,000 820 US$41 820 US$38 US$79 2,500 2,050 US$103 2,050 US$96 US$199 5,000 4,101 US$205 4,101 US$191 US$396 10,000 8,202 US$410 8,202 US$383 US$793 25,000 20,505 US$1,025 20,505 US$957 US$1,982 50,000 41,010 US$2,051 41,010 US$1,913 US$3,964 100,000 82,020 US$4,101 82,020 US$3,826 US$7,927 250,000 205,050 US$10,253 205,050 US$9,566 US$19,819 500,000 410,100 US$20,505 410,100 US$19,131 US$39,636 750,000 615,150 US$30,758 615,150 US$28,697 US$59,455 1,000,000 820,200 US$41,010 820,200 US$38,262 US$79,272 5,000,000 4,100,999 US$205,050 4,100,999 US$191,312 US$396,362 10,000,000 8,201,998 US$410,100 8,201,998 US$382,623 US$792,723 50,000,000 41,009,988 US$2,050,499 41,009,988 US$1,913,116 US$3,963,615 100,000,000 82,019,975 US$4,100,999 82,019,975 US$3,826,232 US$7,927,231

42 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART XII: SHARE PRICE INFORMATION

The table below provides statistical information on Econet Wireless Zimbabwe Limited share price and the volumes traded for each month from 1 January 2015 to 30 November 2016

MONTH HIGH (US CENTS) LOW (US CENTS) VOLUME 2015 January 60.001 50 8,371,812 February 55.02 50 16,262,060 March 52 50 6,615,159 April 50 49 7,663,405 May 50 45 13,456,341 June 45 40 6,160,736 July 37.99 32.01 13,206,428 August 31.75 28 18,811,268 September 28 26.65 16,289,214 October 27.04 26.75 12,123,009 November 26.75 16.01 9,333,044 December 21.09 17.24 22,621,399 2016 January 22.97 19.55 26,194,554 February 24.95 22 25,193,947 March 25 22.56 9,814,930 April 26 25 3,622,237 May 25.49 21.62 3,558,106 June 23.05 20 14,264,622 July 21 19.5 9,649,135 August 20 19.8 3,175,989 September 19.9 19.6 5,072,075 October 30 19.5 11,722,823 November 31.73 27 14,031,381

The volume weighted average share prices determined based on the trading days immediately preceding and including the last practicable date of 30 November 2016 are set out below: a) 30 trading day volume weighted average share price 28.33 US Cents b) 60 trading day volume weighted average share price 26.17 US Cents c) 90 trading day volume weighted average share price 24.21 US Cents

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 43 PART XIII: DETAILS OF THE UNDERWRITER

Set out hereunder are details relating to the underwriter of the Rights Oﬀer:

Name: Econet Global Limited

Registered Oﬃce: 10th Floor, Standard Chartered Tower, 19 Cybercity, Ebene, Mauritius

Date of Incorporation: 9th July 2008

Company registration number: 88185

Company Directors Tracy Mpofu, Eric Venpin, Gaetan Lan, Strive Masiyiwa, James Myers, Nicholas Rudnick, Craig Fitzgerald

Company secretary DTOS Ltd

Issued share capital of the Company. 17,253

44 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART XIV: ECONET WIRELESS ZIMBABWE’S ACCOUNTING POLICIES

1. Accounting Policies There Group’s policy notes that were applicable for the ﬁnancial year ended 29 February 2016, which are detailed below, are the same policies that were applicable for the half year ended 31 August 2016.

Policy note IFRS/IAS reference Content A IAS 1(revised) Presentation of financial statements: General information and functional currency B IAS 1(revised) Basis of preparation C IAS 8 Change in accounting policy, adoption of new and revised Standards D IAS 21 Effects of changes in foreign exchange rates E IFRS 3, 10 Business combinations and goodwill F IAS 28 Investment in associates and joint ventures G IAS 38 Intangible assets H IAS 23 Borrowing costs I IAS 16 Property, plant and equipment J IAS 40 Investment properties K IAS 36 Impairment of property, plant and equipment and intangible assets L IAS 17 Leases M IAS 2 Inventories N IAS 18 Revenue O Other Income P IAS 12 Income taxes Q IAS 19 Employee benefits and retirement benefits R IAS 1(revised) Current versus non-current classification S IFRS 13 Fair value measurements T IFRIC 17 Cash dividend and non-cash distribution to equity holders of the parent U IAS 39, IFRS 7 Financial instruments – initial recognition, subsequent measurement and disclosure V IAS 7 Cash and short term deposits W IAS 32 Treasury shares X IAS 37 Provisions Y Fiduciary assets Z IFRS 8 Operating segments A A IFRS 2 Share based payments AB IAS 1 (Revised) Significant assumptions and key sources of estimation uncertainty

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 45 A GENERAL INFORMATION

A.1 THE COMPANY Econet Wireless Zimbabwe Limited (“the Company”) was incorporated in Zimbabwe on 4 August 1998 and its main operating subsidiary, Econet Wireless Zimbabwe Limited (Private) Limited, on 23 August 1994. The address of its registered office and principal place of business is Econet Park, 2 Old Mutare Road, Msasa, Harare. The main business of the Group is mobile telecommunications and related overlay services. The ultimate holding Company for the Group is Econet Global Limited (previously reported as Econet Wireless Group Limited) which is incorporated in Mauritius. Except where specific reference is made to “the Company”, the notes disclosed in these financial statements pertain to the Group.

A.2 Currency of Account These consolidated ﬁnancial statements are presented in United States Dollars (US$) being the functional and presentation currency of the primary economic environment in which the Company operates.

B BASIS OF PREPARATION

B.1 Statement of compliance The Company’s ﬁnancial statements have been prepared in accordance with International Financial Reporting Standards (IFRS); International Accounting Standards (“IAS”); the International Financial Reporting Interpretations Committee (IFRIC). With the exceptions noted below in policy Note C1 “New and Revised Standards and Interpretations- Adopted”, the accounting policies set out below have been consistently applied from the previous year and through the current year.

B.2 Compliance with legal and regulatory requirements These Company’s ﬁnancial statements have been prepared in accordance with the accounting policies set out below, and comply with the modiﬁed disclosure requirements of the Companies Act (Chapter 24:03) and the relevant statutory instrument (SI33/99 and SI 62 /96) and the Banking Act (Chapter 24:20).

B.3 Use of estimates and judgments The preparation of the consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. Information about the significant areas of accounting judgment; estimations and assumptions in applying accounting policies that have the most significant effect on the amounts recognised in these consolidated financial statements are described in Note AB.

B.4 Basis of consolidation The consolidated financial statements comprise of the financial statements of the Company and its subsidiaries as at 29 February 2016. Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee if, and only if, the Company has: • Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee); • Exposure, or rights, to variable returns from its involvement with the investee; and • The ability to use its power over the investee to affect its returns.

When the Company has less than a majority of the voting or similar rights of an investee, the Company considers all relevant facts and circumstances in assessing whether it has power over an investee, including: • The contractual arrangement with the other vote holders of the investee; • Rights arising from other contractual arrangements; • The Company voting rights and potential voting rights; and • Any additional facts and circumstances that indicate that the Company has, or does not have, the current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders’ meetings.

46 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY The Company re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated ﬁnancial statements from the date the Company gains control until the date the Company ceases to control the subsidiary.

Profit or loss and each component of Other Comprehensive Income (OCI) are attributed to the equity holders of the parent of the Company and to the non-controlling interests, even if this results in the non- controlling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Company’s accounting policies. All intra-Company assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Company are eliminated in full on consolidation.

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.

If the Company loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities, non-controlling interest and components of equity while any resultant gain or loss is recognised in proﬁt or loss. Any investment retained is recognised at fair value.

C ADOPTION OF NEW AND REVISED STANDARDS AND INTERPRETATIONS

C.1 Application of new and revised standards and interpretations – Adopted In the current year, the Company adopted the following new and revised IFRSs and annual improvements to IFRSs. The nature and the impact of each new standard and amendment is described below:

Amendments to IFRSs that are mandatory eﬀective for the year ended 31 December 2015.

Amendments to IAS 19 Defined Benefit Plans: Employee Contributions IAS 19 requires an entity to consider contributions from employees or third parties when accounting for defined benefit plans. Where the contributions are linked to service, they should be attributed to periods of service as a negative benefit. These amendments clarify that, if the amount of the contributions is independent of the number of years of service, an entity is permitted to recognise such contributions as a reduction in the service cost in the period in which the service is rendered, instead of allocating the contributions to the periods of service. This amendment is effective for annual periods beginning on or after 1 July 2014. This amendment is not relevant to the Company, since none of the entities within the Company has defined benefit plans with contributions from employees or third parties.

Annual improvements 2010 – 2012 cycle

IFRS 2 Share-based Payment This improvement is applied prospectively and clarifies various issues relating to the definitions of performance and service conditions which are vesting conditions. The clarifications are consistent with how the Company has identified any performance and service conditions which are vesting conditions in previous periods. Thus, these amendments did not impact the Company’s financial statements or accounting policies.

IFRS 3 Business Combinations The amendment is applied prospectively and clarifies that all contingent consideration arrangements classified as liabilities (or assets) arising from a business combination should be subsequently measured at fair value through profit or loss whether or not they fall within the scope of IAS 39. This is consistent with the Company’s current accounting policy and, thus, this amendment did not impact the Companyp’s accounting policy.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 47 C ADOPTION OF NEW AND REVISED STANDARDS AND INTERPRETATIONS (CONTINUED)

C.1 Application of new and revised standards and interpretations – Adopted (continued) IFRS 8 Operating Segments The amendments are applied retrospectively and clarify that: • An entity must disclose the judgments made by management in applying the aggregation criteria in paragraph 12 of IFRS 8, including a brief description of operating segments that have been aggregated and the economic characteristics (e.g., sales and gross margins) used to assess whether the segments are ‘similar’ • The reconciliation of segment assets to total assets is only required to be disclosed if the reconciliation is reported to the chief operating decision maker, similar to the required disclosure for segment liabilities

The Company has not applied the aggregation criteria in IFRS 8.12. The Company has presented the reconciliation of segment assets to total assets in previous periods and continues to disclose the same in Note 1 in this period’s ﬁnancial statements as the reconciliation is reported to the chief operating decision maker for the purpose of his decision making.

IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets The amendment is applied retrospectively and clariﬁes in IAS 16 and IAS 38 that the asset may be revalued by reference to observable data by either adjusting the gross carrying amount of the asset to market value or by determining the market value of the carrying value and adjusting the gross carrying amount proportionately so that the resulting carrying amount equals the market value. In addition, the accumulated depreciation or amortisation is the diﬀerence between the gross and carrying amounts of the asset. This amendment did not have any impact to the revaluation adjustments recorded by the Company during the current period.

IAS 24 Related Party Disclosures The amendment is applied retrospectively and clariﬁes that a management entity (an entity that provides key management personnel services) is a related party subject to the related party disclosures. In addition, an entity that uses a management entity is required to disclose the expenses incurred for management services. This amendment is not relevant for the Company as it does not receive any management services from other entities.

IFRS 13 Fair Value Measurement – Portfolio exception The amendment is applied prospectively and clarifies that the portfolio exception in IFRS 13 can be applied not only to financial assets and financial liabilities, but also to other contracts within the scope of IAS 39. The Company does not have financial assets, financial liabilities and other contracts that meet this criteria.

Annual improvements to IFRSs 2011 – 2013 Cycle. IFRS 3 Business Combinations The amendment is applied prospectively and clarifies that all contingent consideration arrangements classified as liabilities (or assets) arising from a business combination should be subsequently measured at fair value through profit or loss whether or not they fall within the scope of IAS 39. This is consistent with the Company’s current accounting policy and, thus, this amendment did not impact the Company’s accounting policy.

IAS 40 Investment property - Clarifying the interrelationship of IFRS 3 and IAS 40 when classifying investment property or owner occupied property - Amendment to IAS 40 The description of ancillary services in IAS 40 diﬀerentiates between investment property and owner occupied property. IFRS 3 is used to determine if the transaction is the purchase of an asset or a business combination. The Company will consider the amendment when it enters into business combination transactions where judgment needs to be applied to determine whether the transaction is a purchase of a business or an asset.

48 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY C.2 New and revised IFRSs that are not mandatory effective (but allow for early adoption) for the year ended 31 December 2015.

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.

IFRS 9 Financial Instruments – classification and measurement On 24 July 2014, the International Accounting Standards Board (IASB) issued the final version of IFRS 9 -Financial Instruments bringing together the classification and measurement, impairment and hedge accounting phases of the IASB’s project to replace IAS 39 Financial Instruments: Recognition and Measurement and all previous versions of IFRS 9. The classification and measurement requirements address specific application issues arising in IFRS 9 (2009) that were raised by preparers, mainly from the financial services industry. The expected credit loss model addresses concerns expressed following the financial crisis that entities recorded losses too late under IAS 39.

IFRS 9 stipulates that financial assets are measured at amortised cost, fair value through profit or loss, or fair value through other comprehensive income, based on both the entity’s business model for managing the financial assets and the financial asset’s contractual cash flow characteristics.

Apart from the ‘own credit risk’ requirements, classiﬁcation and measurement of ﬁnancial liabilities is unchanged from existing requirements. IFRS 9 is applicable for annual periods beginning on or after 1 January 2018, but early adoption is permitted. The Group is still assessing the impact of IFRS 9.

IFRS 15 Revenue from Contracts with Customers IFRS 15 was issued in May 2014 and establishes a ﬁve- step model to account for revenue arising from contracts with customers. Under IFRS 15, revenue is recognised at an amount that reﬂects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.

IFRS 15 establishes a ﬁve-step model that will apply to revenue earned from a contract with a customer (with limited exceptions), regardless of the type of revenue transaction or the industry. The standard’s requirements will also apply to the recognition and measurement of gains and losses on the sale of some non-ﬁnancial assets that are not an output of the entity’s ordinary activities (e.g., sales of property, plant and equipment or intangibles). Extensive disclosures will be required, including disaggregation of total revenue; information about performance obligations; changes in contract asset and liability account balances between periods and key judgments and estimates.

The new revenue standard will supersede all current revenue recognition requirements under IFRS. Either a full retrospective application or a modified retrospective application is required for annual periods beginning on or after 1 January 2018, when the IASB finalises their amendments to defer the effective date of IFRS 15 by one year. Early adoption is permitted. The Company plans to adopt the new standard on the required effective date using the full retrospective method. During 2015, the Company performed a preliminary assessment of IFRS 15, which is subject to changes arising from a more detailed ongoing analysis. Furthermore, the Company is considering the clarifications issued by the IASB in an exposure draft in July 2015 and will monitor any further developments.

Amendments to IFRS 11 Joint Arrangements: Accounting for Acquisitions of Interests The amendments to IFRS 11 require that a joint operator accounting for the acquisition of an interest in a joint operation, in which the activity of the joint operation constitutes a business, must apply the relevant IFRS 3 principles for business combinations accounting. The amendments also clarify that a previously held interest in a joint operation is not re-measured on the acquisition of an additional interest in the same joint operation while joint control is retained. In addition, a scope exclusion has been added to IFRS 11 to specify that the amendments do not apply when the parties sharing joint control, including the reporting entity, are under common control of the same ultimate controlling party.

The amendments apply to both the acquisition of the initial interest in a joint operation and the acquisition of any additional interests in the same joint operation and are prospectively eﬀective for annual periods beginning on or after 1 January 2016, with early adoption permitted. These amendments are not expected to have any impact on the Company.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 49 C ADOPTION OF NEW AND REVISED STANDARDS AND INTERPRETATIONS (CONTINUED)

C.2 New and revised IFRSs that are not mandatory effective (but allow for early adoption) for the year ended 31 December 2015. (continued)

Amendments to IAS 16 and IAS 38: Clarification of Acceptable Methods of Depreciation and Amortisation The amendments clarify the principle in IAS 16 and IAS 38 that revenue reflects a pattern of economic benefits that are generated from operating a business (of which the asset is part) rather than the economic benefits that are consumed through use of the asset. As a result, a revenue-based method cannot be used to depreciate property, plant and equipment and may only be used in very limited circumstances to amortise intangible assets. The amendments are effective prospectively for annual periods beginning on or after 1 January 2016, with early adoption permitted. These amendments are not expected to have any impact to the Company given that the Company has not used a revenue-based method to depreciate its non-current assets.

Amendments to IAS 27: Equity Method in Separate Financial Statements The amendments will allow entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements. Entities already applying IFRS and electing to change to the equity method in its separate financial statements will have to apply that change retrospectively. For first-time adopters of IFRS electing to use the equity method in its separate financial statements, they will be required to apply this method from the date of transition to IFRS. The amendments are effective for annual periods beginning on or after 1 January 2016, with early adoption permitted. These amendments will not have any impact on the Company’s consolidated financial statements.

Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture The amendments address the conflict between IFRS10 and IAS 28 in dealing with the loss of control of a subsidiary that is sold or contributed to an associate or joint venture. The amendments clarify that the gain or loss resulting from the sale or contribution of assets that constitute a business, as defined in IFRS 3, between an investor and its associate or joint venture, is recognised in full. Any gain or loss resulting from the sale or contribution of assets that do not constitute a business, however, is recognised only to the extent of unrelated investors’ interests in the associate or joint venture. These amendments must be applied prospectively and are effective for annual periods beginning on or after 1 January 2016, with early adoption permitted. These amendments are not expected to have any impact on the Company.

Amendments to IFRS 10, IFRS 12 and IAS 28 Investment Entities: Applying the Consolidation Exception The amendments address issues that have arisen in applying the investment entities exception under IFRS 10. The amendments to IFRS 10 clarify that the exemption from presenting consolidated ﬁnancial statements applies to a parent entity that is a subsidiary of an investment entity, when the investment entity measures all of its subsidiaries at fair value.

Furthermore, the amendments to IFRS 10 clarify that only a subsidiary of an investment entity that is not an investment entity itself and that provides support services to the investment entity is consolidated. All other subsidiaries of an investment entity are measured at fair value. The amendments to IAS 28 allow the investor, when applying the equity method, to retain the fair value measurement applied by the investment entity associate or joint venture to its interests in subsidiaries.

Annual Improvements 2012-2014 Cycle These improvements are eﬀective for annual periods beginning on or after 1 January 2016. They include:

IFRS 5 Non-current Assets Held for Sale and Discontinued Operations Assets (or disposal groups) are generally disposed of either through sale or distribution to owners. The amendment clariﬁes that changing from one of these disposal methods to the other would not be considered a new plan of disposal, rather it is a continuation of the original plan. There is, therefore, no interruption of the application of the requirements in IFRS 5. This amendment must be applied prospectively.

50 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY IFRS 7 Financial Instruments: Disclosures (i) Servicing contracts The amendment clarifies that a servicing contract that includes a fee can constitute continuing involvement in a financial asset. An entity must assess the nature of the fee and the arrangement against the guidance for continuing involvement in IFRS 7 in order to assess whether the disclosures are required. The assessment of which servicing contracts constitute continuing involvement must be done retrospectively. However, the required disclosures would not need to be provided for any period beginning before the annual period in which the entity first applies the amendments.

(ii) Applicability of the amendments to IFRS 7 to condensed interim financial statements The amendment clarifies that the offsetting disclosure requirements do not apply to condensed interim financial statements, unless such disclosures provide a significant update to the information reported in the most recent annual report. This amendment must be applied retrospectively.

IAS 19 Employee Beneﬁts The amendment clariﬁes that market depth of high quality corporate bonds is assessed based on the currency in which the obligation is denominated, rather than the country where the obligation is located. When there is no deep market for high quality corporate bonds in that currency, government bond rates must be used. This amendment must be applied prospectively.

IAS 34 Interim Financial Reporting The amendment clarifies that the required interim disclosures must either be in the interim financial statements or incorporated by cross-reference between the interim financial statements and wherever they are included within the interim financial report (e.g. in the management commentary or risk report). The other information within the interim financial report must be available to users on the same terms as the interim financial statements and at the same time. This amendment must be applied retrospectively.

These amendments are not expected to have any impact on the Group.

Amendments to IAS 1 Disclosure Initiative The amendments to IAS 1 Presentation of Financial Statements clarify, rather than significantly change, existing IAS 1 requirements. The amendments clarify: • The materiality requirements in IAS 1 • That specific line items in the statement(s) of profit or loss and OCI and the statement of financial position may be disaggregated • That entities have flexibility as to the order in which they present the notes to financial statements • That the share of OCI of associates and joint ventures accounted for using the equity method must be presented in aggregate as a single line item, and classified between those items that will or will not be subsequently reclassified to profit or loss

Furthermore, the amendments clarify the requirements that apply when additional subtotals are presented in the statement of financial position and the statement(s) of profit or loss and OCI. These amendments are effective for annual periods beginning on or after 1 January 2016, with early adoption permitted. These amendments are not expected to have any impact on the Group.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

D FOREIGN CURRENCY TRANSACTIONS AND BALANCES

The Company’s consolidated ﬁnancial statements are presented in United States dollars, which is also the parent Company’s functional currency. For each entity the Company determines the functional currency and items included in the ﬁnancial statements of each entity are measured using that functional currency.

Transactions in currencies other than Company entity’s functional currency (foreign currencies) are initially recorded by the Company’s entities at their respective functional currency spot rates at the date the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date. Differences arising on settlement or translation of monetary items are recognised in profit or loss.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 51 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

D FOREIGN CURRENCY TRANSACTIONS AND BALANCES (CONTINUED)

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.

The gain or loss arising on re-translation of non-monetary items is treated in line with the recognition of the gain or loss on change in fair value of the item i.e. translation differences on items whose fair value gain or loss is recognised in other comprehensive income or profit or loss is also recognised in other comprehensive income or profit or loss.

E BUSINESS COMBINAT IONS AND GOODWILL

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred measured at acquisition date fair value and the amount of any non-controlling interests in the acquire. For each business combination, the Company elects whether to measure the non-controlling interests in the acquire at fair value or at the proportionate share of the acquirer’s identiﬁable net assets. Acquisition- related costs are expensed as incurred and included in administrative expenses.

When the Company acquires a business, it assesses the ﬁnancial assets and liabilities assumed for appropriate classiﬁcation and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree.

If the business combination is achieved in stages, any previously held equity interest is re-measured at its acquisition date fair value and any resulting gain or loss is recognised in proﬁt or loss.

Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date. Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of IAS 39 Financial Instruments: Recognition and Measurement, is measured at fair value with changes in fair value recognised either in profit or loss or as a change to OCI. If the contingent consideration is not within the scope of IAS 39, it is measured in accordance with the appropriate IFRS. Contingent consideration that is classified as equity is not re-measured and subsequent settlement is accounted for within equity.

Goodwill is initially measured and recognised at cost as determined on the acquisition, being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Company re-assesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognised at the acquisition date. If the reassessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in profit or loss.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to revise the Company’s cash-generating units that are expected to beneﬁt from the combination, irrespective of whether other assets or liabilities of the acquire are assigned to those units. This goodwill is subsequently tested for impairment at least on an annual basis and any resulting impairment is recognised immediately in the statement comprehensive income.

Where goodwill has been allocated to a cash generating unit and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash-generating unit retained.

52 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY F INVESTMENTS IN ASSOCIAT E S

An associate is an entity over which the Company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee, but is not control or joint control over those policies.

The considerations made in determining signiﬁcant inﬂuence are similar to those necessary to determine control over subsidiaries.

The Company’s investment in its associate are accounted for using the equity method. Under the equity method, the investment in an associate is initially recognised at cost. The carrying amount of the investment is adjusted to recognise changes in the Company’s share of net assets of the associate since the acquisition date. Goodwill relating to the associate is included in the carrying amount of the investment and is not tested for impairment individually.

The statement of comprehensive income reﬂects the Company’s share of the results of operations of the associate. Any change in OCI of those investees is presented as part of the Company’s OCI. In addition, when there has been a change recognised directly in the equity of the associate, the Company recognises its share of any changes, when applicable, in the statement of changes in equity. Unrealised gains and losses resulting from transactions between the Company and the associate are eliminated to the extent of the interest in the associate.

The aggregate of the Company’s share of proﬁt or loss of an associate is shown on the face of the statement of comprehensive income and represents proﬁt or loss after tax and non-controlling interests in the subsidiaries of the associate.

The ﬁnancial statements of the associate are prepared for the same reporting period as the Company.

After application of the equity method, the Company determines whether it is necessary to recognise an impairment loss on its investment in its associate. At each reporting date, the Company determines whether there is objective evidence that the investment in the associate is impaired. If there is such evidence, the Company calculates the amount of impairment as the diﬀerence between the recoverable amount of the associate and its carrying value, and then recognises the loss in the statement of comprehensive income.

Upon loss of significant influence over the associate, the Company measures and recognises any retained investment at its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the retained investment and proceeds from disposal is recognised in profit or loss.

G INTANGIBLE ASSETS

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less accumulated amortisation and accumulated impairment losses.

Internally generated intangible assets, excluding capitalised development costs, are not capitalised and the related expenditure is reﬂected in proﬁt or loss in the period in which the expenditure is incurred.

The useful lives of intangible assets are assessed as either ﬁnite or indeﬁnite.

Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite is recognised in the statement of comprehensive income in the expense category that is consistent with the function of the intangible assets.

Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 53 made on a prospective basis. G INTANGIBLE ASSETS (continued)

Derecognition An intangible asset is derecognised: (a) On disposal; or (b) When no future economic beneﬁts are expected from its use or disposal. Gains or losses arising from DE recognition of an intangible asset are measured as the diﬀerence between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of comprehensive income when the asset is derecognised.

G.1 Research and development costs Research costs are expensed as incurred. Development expenditures on an individual project are recognised as an intangible asset when the Company can demonstrate: • The technical feasibility of completing the intangible asset so that the asset will be available for use or sale; • The intention to complete and its ability and intention to use or sell the asset; • How the asset will generate probable future economic beneﬁts; • The availability of resources to complete the asset; • The ability to measure reliably the expenditure attributable to the intangible asset during development; and • Adequate technical, ﬁnancial and other resources to complete the development and to use or sell the intangible asset.

Subsequent to initial recognition of the development expenditure as an asset, the asset is carried at cost less accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete and the asset is available for use. It is amortised over the period of expected future beneﬁt. Amortisation is recorded in cost of sales. During the period of development, the asset is tested for impairment annually.

G.2 License and Software The Company made upfront payments for the renewal of its cellular operating license. The license was granted for a period of 20 years by the relevant government agency with the option of renewal at the end of this period. As a result, the license is assessed as having a ﬁnite useful life.

Software comprises software held by Transaction Payment Solutions (Private) Limited, software held by Econet Wireless Zimbabwe (Private) Limited, and software held by Steward Bank Limited.

Software integral to an item of hardware equipment is classiﬁed as property, plant and equipment

The software and licenses are amortised as follows: - license held by Econet Wireless (Private) Limited amortised over 20 years; - software held by Transaction Payment Solutions (Private) Limited is amortised over 2 to 4 years; - software held by Econet Wireless (Private) Limited is amortised over 5 years; and - Software held by Steward Bank Limited is amortised over 4 years.

H BORROWING COSTS

Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the assets, until such time as the assets are substantially ready for their intended use or sale.

Investment income earned on the temporary investment of speciﬁc borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are expensed in the period in which they are incurred.

54 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY I PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment and land and buildings are stated at cost, less accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met. When signiﬁcant parts of plant and equipment are required to be replaced at intervals, the Company recognises such parts as individual assets with speciﬁc useful lives and depreciates them accordingly.

Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisﬁed. Software integral to an item of hardware equipment is classiﬁed as property, plant and equipment.

All other repair and maintenance costs are recognised in proﬁt or loss as incurred.

Assets in the course of construction for production or for other purposes not yet determined are carried at cost less any recognised impairment loss. Costs include professional fees and, for qualifying assets, borrowing costs. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for intended use.

Containers form part of ﬁxed assets and comprise returnable bottles and crates which are sold and repurchased at current deposit prices and are stated at net realisable value. Net realisable value represents the current deposit price that is payable to customers when containers are repurchased from them.

Write downs of containers to net realisable value are expensed over four years. Container breakages and losses are expensed in the period in which they occur. Any gains in net realisable value are recognised in the period in which they occur.

The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset if the recognition criteria for a provision are met.

Property, plant and equipment is subsequently measured at cost less subsequent depreciation and accumulated impairment charges. (See Note K on Impairment of non- ﬁnancial assets.)

Depreciation is recognised so as to write off the cost or valuation of assets (other than freehold land) less their residual values over their useful lives, using the straight- line method. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Depreciation is charged to profit or loss.

Depreciation is not provided on freehold land and capital projects under development.

Other assets are depreciated on such bases as are deemed appropriate to reduce book values to estimated residual values over their useful lives as follows:- - Buildings - 40 years - Network equipment - 3 to 25 years - Beverage plant and equipment - 25 years - Oﬃce equipment - 4 to 10 years - Motor vehicles - 4 to 5 years

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each ﬁnancial year end and adjusted prospectively, if appropriate.

Any item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on DE recognition of the asset, calculated as the difference between the sales proceeds and the carrying amount of the asset is included in profit or loss when the asset is derecognised.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 55 J INVESTMENT PROPERTIES

Investment properties are properties held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at fair value, which reflects market conditions at the reporting date. Gains or losses arising from changes in the fair values of investment properties are included in profit or loss in the period in which they arise, including the corresponding tax effect.

Fair values are determined based on an annual evaluation performed by an accredited external independent value.

Investment properties are derecognised either when they have been disposed or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of DE recognition.

Transfers are made to (or from) investment property only when there is a change in use. For a transfer from investment property to owner-occupied property, the deemed cost for subsequent accounting is the fair value at the date of change in use. If owner-occupied property becomes an investment property, the Company accounts for such property in accordance with the policy stated under property, plant and equipment up to the date of change in use.

K IMPAIRMENT OF NON-FINANCIAL ASSETS

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating units (CGU) fair value less costs of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inﬂows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.

The Company bases its impairment calculation on detailed budgets and forecast calculations, which are prepared separately for each of the Company’s CGUs to which the individual assets are allocated. These budgets and forecast calculations generally cover a period of five years. For longer periods, a long-term growth rate is calculated and applied to project future cash flows after the fifth year.

Impairment losses of continuing operations, including impairment on inventories, are recognised in the statement of comprehensive income in expense categories consistent with the function of the impaired asset.

For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset’s or CGU’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of comprehensive income.

56 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY K IMPAIRMENT OF NON-FINANCIAL ASSETS (CONTINUED)

Goodwill is tested for impairment annually at the reporting date and when circumstances indicate that the carrying value may be impaired.

Impairment is determined for goodwill by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. When the recoverable amount of the CGU is less than its carrying amount, an impairment loss is recognised in the statement of comprehensive income. Impairment losses relating to goodwill cannot be reversed in future periods.

Intangible assets with indeﬁnite useful lives are tested for impairment annually at the reporting date at the CGU level, as appropriate, and when circumstances indicate that the carrying value may be impaired.

L LEASES

A lease is an agreement in which the lessor conveys to the lessee, in return for payment, the right to use an asset for an agreed period of time.

The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the inception of the lease. The arrangement is, or contains, a lease if fulfilment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.

A lease is classified at the inception date as a finance lease or an operating lease. Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. The Group does not have any finance leases.

Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic beneﬁts from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate beneﬁt of incentives is recognised as a reduction of rental expense on a straight- line basis, except where another systematic basis is more representative of the time pattern in which economic beneﬁts from the leased asset are consumed.

Company as a lessee Assets held under finance leases are capitalised at the commencement of the lease at the inception date fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in finance costs in the statement of comprehensive income unless they are directly attributable to a qualifying asset in which case they are capitalised in accordance with the Company’s policy on borrowing costs.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Operating lease payments are recognised as an operating expense in the statement of comprehensive income on a straight-line basis over the lease term.

Company as a lessor Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as revenue in the period in which they are earned.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 57 M INVENTORIES

Inventories are assets (a) held for sale in the ordinary course of business; (b) in the process of production for such sale; or (c) to be consumed in the production process or the rendering of services. The main categories of inventory recognised in the ﬁnancial statements are (a) Merchandise comprising calling cards, handsets, accessories and discards and (b) Spares, stationery and other inventory.

Measurement Inventories are measured at the lower of cost or net realisable value.

Cost comprises all costs necessary to bring the inventories to their present location and condition.

Net realisable value represents the estimated selling price less all estimated costs incurred in the marketing, selling or distribution, where applicable.

Merchandise, raw materials and consumable stores are valued at cost on a weighted average cost basis. Manufactured ﬁnished products and products in process are valued at raw material cost, plus labor and a portion of manufacturing overhead expenses, where appropriate.

Inventories are de-recognised when they are sold, and the carrying amount is recognised as an expense in the period in which the related revenue is recognised.

Impairment Write downs to net realisable value and inventory losses are expensed in the period in which they occur. Obsolete and slow moving inventories are identiﬁed and written down to their estimated economic or realisable value.

The amount of any reversal of any write-down of inventories, arising from an increase in net realisable value, is accounted for as a reduction in the amount of inventories recognised as an expense in the period in which the reversal occurs.

N REVENUE RECOGNITION

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duty. The Company has concluded that it is the principal in all of its revenue arrangements since it is the primary obligor in all the revenue arrangements, has pricing latitude and is also exposed to inventory and credit risks.

The speciﬁc recognition criteria described below must also be met before revenue is recognised.

Te lecommunications

N.1 Contract products

Connection fees Revenue is recognised on the date of activation.

Access charges Revenue from access charges is recognised as the customers are provided access to the network based on the agreed ﬁxed charges.

Airtime Revenue is recognised on a usage basis.

58 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY N.2 Pre-paid products

Starter packs Revenue is recognised on the date of purchase when all risks and rewards associated with the starter-packs are transferred to the purchaser.

Airtime Revenue is recognised when a customer utilises the airtime, at which point the risks and rewards have been transferred. Upon purchase of an airtime voucher the customer receives the right to make outgoing voice calls, use the short message service, download internet data and other overlay services to the value of the voucher. Revenue is deferred until such a time as the customer uses the airtime.

N.3 Internet services

Subscriptions Subscriptions revenue is recognised on a straight-line basis over the period of the subscription.

Data Services Revenue is recognised on the basis of usage by the subscriber in accordance with the substance of the agreement.

N.4 Automated transaction services

Software and hardware sales Revenue is recognised when goods are delivered and ownership has passed.

Service revenues Revenue is recognised on the accrual basis in accordance with the substance of the agreement.

N.5 Interconnect services Interconnect services revenue is recognised when the service is rendered.

N.6 Bundled products Post-paid and prepaid products with multiple deliverables are deﬁned as multiple element arrangements.

Post-paid products typically include the sale of a handset, activation fee and a service contract; and prepaid products include a subscriber identiﬁcation module (SIM) card and airtime.

These arrangements are divided into separate units of accounting, and revenue is recognised through application of the residual value method. In applying the residual value method, an estimate of the stand-alone selling price of a good or service is made by reference to the total transaction price less the sum of the observable stand-alone selling prices of other goods or services promised in the contract (the residual value).

N.7 Other revenue

N.7.1 Sale of goods Revenue from the sale of goods is recognised when the signiﬁcant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the goods. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates.

The Company does not provide any extended warranties or maintenance contracts to its customers.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 59 N REVENUE RECOGNITION (CONTINUED)

N.7.2 Interest income and expense For all financial instruments measured at amortised cost, interest-bearing financial assets classified as available- for- sale, and financial instruments designated at fair value through profit or loss, interest income or expense is recorded using the effective interest (EIR) method. EIR is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset or financial liability. The calculation takes into account all contractual terms of the financial instrument (for example, prepayment options) and includes any fees or incremental costs that are directly attributable to the instrument and are an integral part of the EIR, but not future credit losses.

The carrying amount of the financial asset or financial liability is adjusted if the Bank revises its estimates of payments or receipts. The adjusted carrying amount is calculated based on the original EIR and the change in carrying amount is recorded as ’Interest income’ for financial assets and ’Interest expense’ for financial liabilities. However, for a reclassified financial asset for which the Bank subsequently increases its estimates of future cash receipts as a result of increased recoverability of those cash receipts, the effect of that increase is recognised as an adjustment to the EIR from the date of the change in estimate.

Once the recorded value of a financial asset or a group of similar financial assets has been written down due to an impairment loss, interest income continues to be recognised using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss.

N7.3 Banking fee and commission income The bank earns fee and commission income from a diverse range of services it provides to its customers. Fee income can be divided into the following two categories: • Fee income earned from services that are provided over a certain period of time; and • Fees earned for the provision of services over a period of time are accrued over that period.

These fees include commission income and asset management, custody and other management and advisory fees.

Loan commitment fees for loans that are likely to be drawn down and other credit related fees are deferred (together with any incremental costs) and recognised as an adjustment to the EIR on the loan. When it is unlikely that a loan will be drawn down, the loan commitment fees are recognised over the commitment period on a straight line basis.

Fee income from providing transactions services Fees arising from negotiating or participating in the negotiation of a transaction for a third party, such as the arrangement of the acquisition of shares or other securities or the purchase or sale of businesses, are recognised on completion of the underlying transaction. Fees or components of fees that are linked to a certain performance are recognised after fulﬁlling the corresponding criteria.

N.7.4 Medical aid income

Contribution income Contribution income is recognised in the accounting period in which contributions are received and membership is granted.

Fees Fees are recognised as revenue in the accounting period in which the services were rendered, by reference to the completion of the speciﬁc transaction assessed on the basis of the actual service provided as a proportion of the total services to be provided.

N.7.5 Insurance income

Premium income Gross premiums comprise the premiums on contracts entered into during the year. Premiums written include adjustments to premiums written in prior periods. Premium income arising from funeral cover is recognised when paid.

60 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY O OTHER INCOME

O.1 Net trading income from financial instruments Results arising from trading activities include all gains and losses from changes in fair value and related interest income or expense and dividends for ﬁnancial assets and ﬁnancial liabilities ‘held for trading’.

O.2 Dividend Income Dividend income is recognised when the Company’s right to receive the payment is established (provided that it is probable that the economic beneﬁts will ﬂow to the Company), which is generally when shareholders approve the dividend.

O.3 Rental income Rental income arising from operating leases on investment properties is accounted for on a straight- line basis over the lease terms and is included in other income in the statement of comprehensive income. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

P TAXATION

P.1 Current income tax Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the country where the Company operates and generates taxable income.

Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of comprehensive income. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

P.2 Deferred tax Deferred tax is provided using the liability method on temporary diﬀerences between the tax bases of assets and liabilities and their carrying amounts for ﬁnancial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, except: • When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss and • In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except: • When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss and • In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 61 P TAXATION (CONTINUED)

P.2 Deferred tax (continued) The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside proﬁt or loss is recognised outside proﬁt or loss. Deferred tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are oﬀset if a legally enforceable right exists to set oﬀ current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

Tax beneﬁts acquired as part of a business combination, but not satisfying the criteria for separate recognition at that date, are recognised subsequently if new information about facts and circumstances change. The adjustment is either treated as a reduction in goodwill (as long as it does not exceed goodwill) if it was incurred during the measurement period or recognised in proﬁt or loss.

Current and deferred tax for the period Current and deferred tax are recognised as income or as an expense in profit or loss, except when they relate to items that are recognised outside profit or loss (whether in other comprehensive income or directly in equity), in which case the tax is also recognised outside profit or loss, or where they arise from the initial accounting for a business combination. In the case of a business combination, the tax effect is included in the accounting for the business combination.

P. 3 Value Added Tax (VAT) Expenses and assets are recognised net of the amount of VAT, except: • When the VAT incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case, the tax is recognised as part of the cost of acquisition of the asset or as part of the expense item, as applicable • When receivables and payables are stated with the amount of Value Added Tax included

The net amount of VAT recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statement of ﬁnancial position.

Q EMPLOYEE BENEFITS

Employee beneﬁts are all forms of consideration given in exchange for services rendered by employees or for the termination of employment.

The classification, recognition and measurement of these employee benefits is as follows; a) Short-term employee benefits Short-term employee benefits are employee benefits (other than termination benefits) that are expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related service. The Company’s short term employee benefits comprise remuneration in the form of salaries, wages, bonuses, employee entitlement to leave pay and medical aid.

The undiscounted amount of all short-term employee beneﬁts expected to be paid in exchange for service rendered are recognised as an expense or as part of the cost of an asset during the period in which the employee renders the related service. The Company recognises the expected cost of bonuses only when the Company has a present legal or constructive obligation to make such payment and a reliable estimate can be made.

62 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY b) Post-employment benefits Post-employment benefits are employee benefits (other than termination benefits and short-term employee benefits) that are payable after the completion of employment.

Post-employment benefits comprise retirement benefits that are provided for Company employees through an independently administered defined contribution fund and by the National Social Security Authority (NSSA), which is also a defined contribution fund from the Company’s perspective. Payments to the defined contribution fund and to the NSSA scheme are recognised as an expense when they fall due, which is when the employee renders the service. The Company has no liability for Post- employment Retirement Benefit Funds once the current contributions have been paid at the time the employees render service.

During the year the Company contributed to the Company defined contribution fund and to the NSSA scheme. c) Termination benefits Termination benefits are employee benefits provided in exchange for the termination of an employee’s employment as a result of either an entity’s decision to terminate an employee’s employment before the normal retirement date (or contractual date) or an employee’s decision to accept voluntary redundancy in exchange for those benefits. The Company recognises termination benefits as a liability and an expense at the earlier of when the offer of termination cannot be withdrawn or when the related restructuring costs are recognised under IAS 37 Provisions, Contingent Liabilities and Contingents Assets.

Termination benefits are measured according to the terms of the termination contract. Where termination benefits are due more than 12 months after the reporting period, the present value of the benefits shall be determined. The discount rate used to calculate the present value shall be determined by reference to market yields on high quality corporate bonds at the end of the reporting period.

R CURRENT AND NON CURRENT CLASSIFICATION

The Company presents assets and liabilities in statement of ﬁnancial position based on current or non-current classiﬁcation.

An asset is current when it is: • Expected to be realised or intended to be sold or consumed in the normal operating cycle; or • Held primarily for the purpose of trading; or • Expected to be realised within twelve months after the reporting period; or • Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period

The Group classifies all other assets that do not meet the definition above are classified as non-current.

A liability is current when: • It is expected to be settled in the normal operating cycle or; • It is held primarily for the purpose of trading or; • It is due to be settled within twelve months after the reporting period or; • There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period

The Company classifies all other liabilities that do not meet the definition above as non-current. Deferred tax assets and liabilities are classified as non- current assets and liabilities respectively.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 63 S FAIR VALUE MEASUREMENT

The Company measures financial instruments such as available for sale financial assets and financial assets at fair value through profit or loss and non-financial assets such as investment properties, at fair value at each balance sheet date. Fair value related disclosures for financial instruments and non-financial assets that are measured at fair value.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: • In the principal market for the asset or liability or; • In the absence of a principal market, in the most advantageous market for the asset or liability The principal or the most advantageous market must be accessible by the Company. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-ﬁnancial asset takes into account a market participant’s ability to generate economic beneﬁts by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which suﬃcient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the ﬁnancial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is signiﬁcant to the fair value measurement as a whole:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities. Level 2 — Valuation techniques for which the lowest level input that is signiﬁcant to the fair value measurement is directly or indirectly observable. Level 3 — Valuation techniques for which the lowest level input that is signiﬁcant to the fair value measurement is unobservable.

For assets and liabilities that are recognised in the ﬁnancial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation (based on the lowest level input that is signiﬁcant to the fair value measurement as a whole) at the end of each reporting period.

The Board of Directors through management determines the policies and procedures for both recurring fair value measurement, such as investment properties, and for non-recurring measurement, such as assets held for sale, where applicable.

External values are involved for valuation of signiﬁcant assets, such as investment properties. Involvement of external values is decided upon annually by the Board of Directors. Selection criteria includes market knowledge, reputation, independence and whether professional standards are maintained.

At each reporting date, management analyses the movements in the values of assets and liabilities which are required to be re-measured or reassessed as per the Company’s accounting policies. For this analysis, management veriﬁes the major inputs applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

T CASH DIVIDEND AND NON-CASH DISTRIBUTION TO EQUIT Y HOLDERS OF THE PARENT

The Company recognises a liability to make cash or non-cash distributions to equity holders of the parent when the distribution is authorised and the distribution is no longer at the discretion of the Company. As per the corporate laws in Zimbabwe, a distribution is authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity.

64 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY T CASH DIVIDEND AND NON-CASH DISTRIBUTION TO EQUIT Y HOLDERS OF THE PARENT (CONTINUED)

Non-cash distributions are measured at the fair value of the assets to be distributed with fair value re- measurement recognised directly in equity. Upon distribution of non-cash assets, any diﬀerence between the carrying amount of the liability and the carrying amount of the assets distributed is recognised in the statement of comprehensive income.

U FINANCIAL INSTRUMENTS – INITIAL RECOGNITION AND SUBSEQUENT MEASUREMENT

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets and financial liabilities are recognised when a Group entity becomes party to the contractual provisions of the instrument.

U.1 Financial assets

Initial recognition and measurement Financial assets are classified, at initial recognition, as financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, available for sale financial assets, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Purchases or sales of ﬁnancial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Group commits to purchase or sell the asset.

Subsequent measurement For purposes of subsequent measurement financial assets are classified in four categories: • Financial assets at fair value through profit or loss; • Loans and receivables; • Held-to-maturity investments; and • Available for sale financial assets

U.1.1 Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit or loss. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value with net changes in fair value presented in the statement of comprehensive income.

U.1.2 Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial measurement, such financial assets are subsequently measured at amortised cost using the Effective Interest Rate (EIR) method, less any impairment. Interest income is recognised by applying the effective interest rate, except for short- term receivables when the effect of discounting is immaterial. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the statement of comprehensive income. The losses arising from impairment are recognised in profit or loss.

U.1.3 Held-to-maturity investments Non-derivative financial assets with fixed or determinable payments and fixed maturities are classified as held to maturity when the Company has the positive intention and ability to hold them to maturity. After initial measurement, held to maturity investments are measured at amortised cost using the EIR, less impairment. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance income in the statement of comprehensive income. The losses arising from impairment are recognised in the statement of comprehensive income.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 65 U FINANCIAL INSTRUMENTS – INITIAL RECOGNITION AND SUBSEQUENT MEASUREMENT (CONTINUED)

U.1.4 Available for Sale financial assets Available for Sale (“AFS”) financial assets include equity investments and debt securities. Equity investments classified as AFS are those that are neither classified as held for trading nor designated at fair value through profit or loss.

Debt securities in this category are those that are intended to be held for an indeﬁnite period of time and that may be sold in response to needs for liquidity or in response to changes in market conditions.

After initial measurement, AFS financial assets are subsequently measured at fair value with unrealised gains or losses recognised in OCI and credited in the AFS reserve until the investment is derecognised, at which time the cumulative gain or loss is recognised in other operating income. If the investment is determined to be impaired, the cumulative loss is reclassified from the AFS reserve to profit or loss.

Interest earned whilst holding AFS ﬁnancial assets is reported as interest income using the EIR method.

The Company evaluates whether the ability and intention to sell its AFS financial assets in the near term is still appropriate. When, in rare circumstances, the Company is unable to trade these financial assets due to inactive markets, the Company may elect to reclassify these financial assets if management has the ability and intention to hold the assets for foreseeable future or until maturity.

For a financial asset reclassified from the AFS category, the fair value carrying amount at the date of reclassification becomes its new amortised cost and any previous gain or loss on the asset that has been recognised in equity is amortised to profit or loss over the remaining life of the investment using the EIR. Any difference between the new amortised cost and the maturity amount is also amortised over the remaining life of the asset using the EIR. If the asset is subsequently determined to be impaired, then the amount recorded in equity is reclassified to the statement of comprehensive income.

Derecognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e., removed from the Group’s consolidated statement of financial position) when: • The rights to receive cash flows from the asset have expired or; • The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash ﬂows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company’s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reﬂects the rights and obligations that the Company has retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.

U.1.5 Impairment of financial assets The Company assesses, at each reporting date, whether there is objective evidence that a financial asset or a group of financial assets is impaired. An impairment exists if one or more events that has occurred since the initial recognition of the asset (an incurred ‘loss event’), has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated. Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation and observable data indicating that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

66 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY U FINANCIAL INSTRUMENTS – INITIAL RECOGNITION AND SUBSEQUENT MEASUREMENT (CONTINUED)

U.1.5.1 Financial assets carried at amortised cost For financial assets carried at amortised cost, the Company first assesses whether impairment exists individually for financial assets that are individually significant, or collectively for financial assets that are not individually significant. If the Company determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is, or continues to be, recognised are not included in the collective assessment of impairment.

The amount of any impairment loss identified is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future expected credit losses that have not yet been incurred). The present value of the estimated future cash flows is discounted at the financial asset’s original effective interest rate.

The carrying amount of the asset is reduced through the use of an allowance account and the loss is recognised in the statement of comprehensive income. Interest income (recorded as finance income in the statement of comprehensive income) continues to be accrued on the reduced carrying amount and is accrued using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. Loans together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or reduced by adjusting the allowance account. If a write-off is later recovered, the recovery is credited to finance costs in the statement of comprehensive income.

U.1.5.2 AFS financial assets For AFS ﬁnancial assets, the Company assesses at each reporting date whether there is objective evidence that an investment or a group of investments is impaired.

In the case of equity investments classified as AFS, objective evidence would include a significant or prolonged decline in the fair value of the investment below its cost. The determination of what is ‘significant’ or ‘prolonged’ requires judgment. ‘Significant’ is evaluated against the original cost of the investment and ‘Prolonged’ against the period in which the fair value has been below its original cost. When there is evidence of impairment, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that investment previously recognised in the statement of comprehensive income – is removed from OCI and recognised in the statement of comprehensive income. Impairment losses on equity investments are not reversed through profit or loss; increases in their fair value after impairment are recognised in OCI.

In the case of debt instruments classified as AFS, the impairment is assessed based on the same criteria as financial assets carried at amortised cost. However, the amount recorded for impairment is the cumulative loss measured as the difference between the amortised cost and the current fair value, less any impairment loss on that investment previously recognised in the statement of comprehensive income.

Future interest income continues to be accrued based on the reduced carrying amount of the asset, using the rate of interest used to discount the future cash ﬂows for the purpose of measuring the impairment loss. The interest income is recorded as part of ﬁnance income.

If, in a subsequent year, the fair value of a debt instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in the statement of comprehensive income, the impairment loss is reversed through the statement of comprehensive income.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 67 U FINANCIAL INSTRUMENTS – INITIAL RECOGNITION AND SUBSEQUENT MEASUREMENT (CONTINUED)

U.2 FINANCIAL LIABILITIES

Initial recognition and measurement Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs. The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, financial guarantee contracts and derivative financial instruments.

Subsequent measurement The measurement of ﬁnancial liabilities depends on their classiﬁcation, as described below:

U.2.1 Loans and borrowings This is the category most relevant to the Company. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in proﬁt or loss when the liabilities are derecognised as well as through the EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as ﬁnance costs in the statement of comprehensive income.

This category generally applies to interest-bearing loans and borrowings. For more information refer Note 30.

U.2.2 Financial guarantee contracts Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the speciﬁed debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the best estimate of the expenditure required to settle the present obligation at the reporting date and the amount recognised less cumulative amortisation.

Derecognition A ﬁnancial liability is derecognised when the obligation under the liability is discharged, cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the DE recognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of comprehensive income.

U.3 OFFSETTING OF FINANCIAL INSTRUMENTS

Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis or to realise the assets and settle the liabilities simultaneously.

68 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY V CASH AND SHORT-TERM DEPOSITS

Cash and short-term deposits in the statement of ﬁnancial position comprise cash at banks and on hand and short- term deposits with a maturity of three months or less, which are subject to an insigniﬁcant risk of changes in value.

For the purpose of the consolidated statement of cash ﬂows, cash and cash equivalents consist of cash and short- term deposits, as deﬁned above.

W TREASURY SHARES

Own equity instruments that are reacquired (treasury shares) are recognised at cost and deducted from equity.

No gain or loss is recognised in proﬁt or loss on the purchase, sale, issue or cancellation of the Company’s own equity instruments. Any diﬀerence between the carrying amount and the consideration, if reissued, is recognised in share premium.

X. PROVISIONS

General Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outﬂow of resources embodying economic beneﬁts will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of comprehensive income net of any reimbursement.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

Y FIDUCIARY ASSETS

To the extent that the Company provides trust and other fiduciary services that result in the holding or investing of assets on behalf of its clients, the assets held in a fiduciary capacity are not reported in the financial statements, as they are not the assets of the Company.

Z OPERATING SEGMENT INFORMATION

The Company identiﬁes segments as components of the Company that engage in business activities from which revenues are earned and expenses incurred (including revenues and expenses relating to transactions with other components of the same entity), whose operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete ﬁnancial information is available.

The chief operating decision-maker has been identiﬁed as the Group Chief Executive Oﬃcer.

Measurement of segment information The accounting policies of the reportable segments are the same as the Company’s accounting policies. Segment information has been reconciled to the consolidated annual ﬁnancial statements to take account of inter- segment transactions and transactions and balances that are not allocated to reporting segments.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 69 AA SHARE-BASED PAYMENTS

Employees of the Company were oﬀered termination beneﬁts in the form of share-based payments, whereby employees rendered the services as consideration for equity instruments (equity-settled transactions).

Equity-settled transactions The cost of equity-settled transactions is determined byte fair value at the date when the grant is made using an appropriate valuation model, further details of which are given in Note 24. That cost is recognised in employee benefits expense (Note 4), together with a corresponding increase in equity (other capital reserves), over the period in which the service and, where applicable, the performance conditions are fulfilled (the vesting period). The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company’s best estimate of the number of equity instruments that will ultimately vest. The expense or credit in the statement of comprehensive income for a period represents the movement in cumulative expense recognised as at the beginning and end of that period. Service and non-market performance conditions are not taken into account when determining the grant date fair value of awards, but the likelihood of the conditions being met is assessed as part of the Company’s best estimate of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the grant date fair value. Any other conditions attached to an award, but without an associated service requirement, are considered to be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and lead to an immediate expensing of an award unless there are also service and/or performance conditions.

No expense is recognised for awards that do not ultimately vest because non-market performance and/or service conditions have not been met. Where awards include a market or non-vesting condition, the transactions are treated as vested irrespective of whether the market or non-vesting condition is satisﬁed, provided that all other performance and/or service conditions are satisﬁed.

When the terms of an equity-settled award are modified, the minimum expense recognised is the grant date fair value of the unmodified award, provided the original terms of the award are met. An additional expense, measured as at the date of modification, is recognised for any modification that increases the total fair value of the share- based payment transaction, or is otherwise beneficial to the employee.

Where an award is cancelled by the entity or by the counterparty, any remaining element of the fair value of the award is expensed immediately through proﬁt or loss.

The dilutive eﬀect of outstanding options is reﬂected as additional share dilution in the computation of diluted earnings per share (further details are given in Note 10.

AB SIGNIFICANT ACCOUNTING JUDGEMENTS; ESTIMAT E S AND ASSUMPTIONS

The preparation of the Company’s consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Judgments In the process of applying the Company’s accounting policies, management has made the following judgments, which have the most significant effect on the amounts recognised in the consolidated financial statements:

Capitalisation of borrowing costs When capitalising borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset, the matter of determining whether an asset takes a substantial period of time to get ready for its intended use, normally one year, is deemed to be a signiﬁcant area of judgment.

In particular, as there are multiple financing sources for both general and specific use, allocation of borrowing costs demands significant judgment.

70 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY Estimates and assumptions The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the consolidated financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

AB. 1 Property, plant and equipment - IAS 16 Property, plant and equipment represent a signiﬁcant proportion of the asset base of the Company, therefore, the estimates and assumptions made to determine their carrying value and related depreciation are critical to the Company’s ﬁnancial position and performance.

Residual values of property, plant and equipment During the year management assessed the residual values of property, plant and equipment. Residual values of each asset category have been assessed by considering the fair value of the assets after taking into account age, usage and obsolescence. These residual values are reassessed each year and adjustments are made where appropriate. The valuation methods adopted in this process involves signiﬁcant judgment and estimation.

Useful lives of property, plant and equipment A review of the estimated remaining lives of all network equipment was performed using the engineering expertise within the business with reference to published industry benchmarks.

This review considered the following factors, at a minimum; the age of the equipment, technological advancements, current use of the equipment, and planned network upgrade programmers. The determination of the remaining estimated useful lives of the network equipment is deemed to be a signiﬁcant area of judgment due to its highly specialised nature. Refer to Note Me for the useful lives of property, plant and equipment.

Network modernisation The network cellar segment embarked on a network modernisation project during the year. The transaction involved the swap out of old equipment for new equipment.

Signiﬁcant judgments are made by directors in determining the extent to which the exchange transactions impact the future cash ﬂows of the business, and thus if the transaction has commercial substance and the consequential accounting treatment.

In determining if the transaction has commercial substance directors assesses if: a) The configuration (risk, timing and amount) of cash flows of the assets received differs from the configuration of the cash flows of the assets transferred; b) The entity-specific value of the portion of the entity’s operations affected by the transaction changes as a result of the exchange; and c) The difference in (a) or (b) is significant relative to the fair value of the assets exchanged.

The Directors therefore concluded that the swap had commercial substance, and thus the equipment acquired was recognised at fair value.

The fair value of the new equipment was ascertained as the cash consideration that would have been exchanged in an arm’s length and orderly transaction between willing market participants, had the new equipment been acquired for a cash consideration only.

AB.2 Intangible assets - IAS 38 Intangible assets include licenses and development costs. These assets arise from both separate purchases and from acquisition as part of business combinations. On the acquisition of mobile network operators, the identiﬁable intangible assets may include licenses, customer bases and brands.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 71 AB SIGNIFICANT ACCOUNTING JUDGEMENTS; ESTIMAT E S AND ASSUMPTIONS (CONTINUED)

AB.2 Intangible assets - IAS 38 (continued) The fair value of these assets is determined by discounting estimated future net cash flows generated by the asset, where no active market for the assets exists. The use of different assumptions for the expectations of future cash flows and the discount rate would change the valuation of the intangible assets.

Estimation of useful life The useful life used to amortise intangible assets relates to the future performance of the assets acquired and management’s judgment of the period over which economic beneﬁt will be derived from the asset.

The basis for determining the useful life for the most signiﬁcant categories of intangible assets is as follows:

AB.2.1 Licenses The estimated useful life is, generally, the term of the license, unless there is a presumption of renewal at negligible cost. Using the license term reflects the period over which the Company will receive economic benefit. For technology specific licenses with a presumption of renewal at negligible cost, the estimated useful economic life reflects the Company’s expectation of the period over which the Company will continue to receive economic benefit from the license. The economic lives are periodically reviewed, taking into consideration such factors as changes in technology. Historically, any changes to economic lives have not been material following these reviews.

AB.2.2 Capitalised software The useful life is determined by management at the time the software is acquired and brought into use and is regularly reviewed for appropriateness. For computer software licenses, the useful life represents management’s view of the period over which the Company will receive beneﬁts from the software, but not exceeding the license term.

For unique software products controlled by the Company, the useful life is based on historical experience with similar products as well as anticipation of future events, which may impact their life, such as changes in technology. Historically, changes in useful lives have not resulted in material changes to the Company’s amortisation charge.

AB.3 Impairment reviews - IAS 36 Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal calculation is based on available data from binding sales transactions, conducted at arm’s length, for similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a Discounted Cashflow (“DCF”) model. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the asset’s performance or the Cash Generating Unit (CGU) being tested. The recoverable amount is sensitive to the discount rate used for the DCF model as well as the expected future cash-inflows and the growth rate used for extrapolation purposes. These estimates are most relevant to the goodwill recognised by the Company. The key assumptions used to determine the recoverable amount for the different CGUs are disclosed and further explained in Note 43.

AB.4 Provisions

Provision for impairment of accounts receivable The provision for impairment is based on an estimate of the recoverability of accounts receivable and subject to estimation.

Provision for long service awards In accordance with IAS 37 - Provisions, Contingent Liabilities and Contingent Assets, a constructive obligation exists within the Company for the payment of long service awards. This obligation is derived from the past practice of paying out awards and has thus created a constructive obligation.

IAS 19 - Employee Beneﬁts, outlines the accounting treatment of long service awards payable to qualifying employees. The standard provides guidance on the determination of provisions such as the long service awards.

72 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY The provision is determined by discounting to net present value the future cash ﬂows for long service awards. In computing the obligation, the Company management have made the following assumptions:

• Staﬀ retention period – 15 years (This represents the expected period employees are likely to stay employed by the Company. It takes into consideration past behaviours and external market research on behaviours patterns of certain age groups and their employment trends); and • Discount rate – 10% based on the computed weighted average cost of capital.

AB.5 Syndicated loans Certain cash ﬂows used in the calculation of amortised cost of the syndicated loans are based on forecast future interest rates (LIBOR) which are subject to estimation. The interest is based on various interest arrangements on facilities with various lenders.

AB.6 Deferred revenue Revenue for cellular network services is recognised when the airtime is utilised by the customer. The unused air time as at 29 February 2016 has been deferred from revenue until the airtime has been used by the customers. The deferred revenue portion is determined by both information technology related checks and arithmetical formulae to identify the portion of revenue to be deferred.

AB.7 Investment property - determination of fair value Where the fair values of investment property cannot be derived from an active market, they are determined using a variety of valuation techniques. Determining the valuation technique to use and the inputs requires signiﬁcant judgment.

AB.8 Impairment losses on loans and advances to bank customers The Company reviews its individually significant loans and Advances to bank customers at each statement of financial position date to assess whether an impairment loss should be recorded in the statement of comprehensive income. In particular, management’s judgment is required in the estimation of the amount and timing of future cash flows when determining the impairment loss. These estimates are based on assumptions about a number of factors and actual results may differ, resulting in future changes to the allowance.

AB 8.1 Impairment provision a. Specific and portfolio provisions Loans and advances that have been assessed individually and found not to be impaired and all individually insignificant loans and advances are then assessed collectively, in groups of assets with similar risk characteristics, to determine whether provision should be made due to incurred loss events for which there is objective evidence, but the effects of which are not yet evident. The collective assessment takes account of data from the loan portfolio (such as levels of arrears, credit utilisation, loan-to-collateral ratios, etc.), and judgments on the effect of concentrations of risks and economic data. b. Regulatory provision The Reserve Bank of Zimbabwe requires the Bank to provide provisions for impairments on loans. Where the regulatory provision is higher than the IAS 39, ‘Financial Instruments: Recognition and Measurement’ the excess is recognised as an appropriation of reserves. c. Past due but not impaired loans Loans and advances where contractual interest or principal payments are past due but the Group believes that impairment is not appropriate on the basis of the level of security/collateral available and/or the stage of collection of amounts owed to the Company.

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 73 AB SIGNIFICANT ACCOUNTING JUDGEMENTS; ESTIMAT E S AND ASSUMPTIONS (CONTINUED)

AB.9 Taxation Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilised. Significant management judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies.

These losses relate to subsidiaries that have a history of losses, and may not be used to oﬀset taxable income elsewhere in the Group.

AB.10 Share-based payments Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation model, which depends on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option or appreciation right, volatility and dividend yield and making assumptions about them. The Company initially measures the cost of cash-settled transactions with employees using a binomial model to determine the fair value of the liability incurred. For cash-settled share-based payment transactions, the liability needs to be premeasured at the end of each reporting period up to the date of settlement, with any changes in fair value recognised in the proﬁt or loss. This requires a reassessment of the estimates used at the end of each reporting period. For the measurement of the fair value of equity-settled transactions with employees at the grant date, the Company uses the market price of the share at the grant date or the fair value of the services rendered as determined by the employment beneﬁts contract.

74 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY PART XV: DIRECTORS’ RESPONSIBILITY STATEMENT

The Directors whose names are given below, collectively and individually accept full responsibility for the accuracy of the information given, and certify that to the best of their knowledge and belief there are no other facts the omission of which would make any statement false or misleading, and that they made all reasonable inquiries to ascertain such facts.

The Directors also confirm that this Circular includes all such information within their knowledge (or which it would be reasonable for them to obtain by making enquiries) that investors and their professional advisors would require and reasonably expect to find for the purposes of making an informed assessment of the assets and liabilities, financial position, profits and losses and prospects of Econet Wireless Zimbabwe Limited and of the rights attaching to the securities to which the Circular relates.

Name of Director Signature

Dr James Myers Signed on original

Mr Strive Masiyiwa Signed on original

Mr Craig Fitzgerald Signed on original

Mr Douglas Mboweni Signed on original

Mr Roy Chimanikire Signed on original

Mrs Tracy Mpofu Signed on original

Mr Krison Chirairo Signed on original

Ms Beatrice Mtetwa Signed on original

Mrs Sherree Shereni Signed on original

Mr Godfrey Gomwe Signed on original

Mr Martin Edge Signed on original

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 75 ANNEXURE A: NOTICE OF EXTRAORDINARY GENERAL MEETING

Econet Wireless Zimbabwe Limited 2 Old Mutare Road Harare, Zimbabwe

In terms of the Company’s Memorandum and Articles of Association, notice is hereby given that an Extraordinary General Meeting of shareholders of Econet Wireless Zimbabwe Limited will be held at 10:00am on the 3rd of February 2017 at 2 Old Mutare Road, Msasa, Harare to consider, and, if deemed ﬁt, to pass, with or without modiﬁcation, the following ordinary resolution.

As an Ordinary Resolution:

1. “That, the Directors of the Company be and hereby authorised to issue 1,082,088,944 ordinary shares plus 263,050,614 Class A shares at a subscription price of US 5 Cents each on the basis of circa 82 ordinary shares for every 100 shares already held to such shareholders or their renouncees as may subscribe for them, or to the underwriter as the case maybe.”

2. “That, the Directors be and hereby authorised to issue and allot 1,345,139,558 Debentures out of the stock of the Company at an issue price of 4.665 US Cents with a coupon of 5% per annum payable on redemption at the redemption date that is six (6) years from the date of issue at the redemption value of 6.252 US Cents inclusive of interest.”

3. “That, each Debenture shall be linked to each Rights Oﬀer share at the time of subscription but should be automatically delinked upon issuing and allotment to enable the Debentures and shares to be tradeable independent of each other.”

4. “That, the Debenture shall be freely tradeable provided that the transfer of the Debenture from one holder to a subsequent holder shall require the approval of the Debenture Trustee appointed by the Company.”

5. “That, the Directors of the Company be and hereby authorised to issue renounceable letters of Allocation which shall be tradeable as nil paid Rights with respect to the Rights Oﬀer Shares to be listed on the Zimbabwe Stock Exchange.”

6. “That the Directors be and hereby authorised to use the entire Rights Offer and Debenture offer proceeds to pay off the foreign debt set out in the Circular dated 17 January 2017.”

By Order of the Board

Econet Wireless Zimbabwe Limited

C.A. Banda Group Company Secretary

Date: 17 January 2017

76 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY ANNEXURE B: PROXY FORM – EGM

Econet Wireless Zimbabwe Limited 2 Old Mutare Road Harare, Zimbabwe

I/We………………………………………………………………………………………… of……………………………………………… being the registered holders of ………..…………………………….. Ordinary shares in Econet Wireless Zimbabwe Limited hereby appoint:

…………………………………………………………………………………..…………………………..………………………. or failing him/her …………………………………………………………………… or failing him/her The Chairman of the Meeting, as my proxy to act for me/us at the Extraordinary General Meeting of the Company which shall be held at 2 Old Mutare Road, Msasa, Harare 10:00am on the 3rd of February 2017 and at any adjournment thereof, and vote for me/us on my/our behalf or to abstain from voting.

Do hereby record my votes for the resolutions to be submitted as follows: Tick (√) or place an “X: inside the BOX. Please note that alterations made to your initial response should be signed for. In Not in favour Abstention Favour As an Ordinary Resolution 1: “That, the Directors of the Company be and hereby authorised to issue 1,082,088,944 ordinary shares plus 263,050,614 Class A shares at a subscription price of US 5 Cents each on the basis of circa 82 ordinary shares for every 100 shares already held to such shareholders or their renouncees as may subscribe for them, or to the underwriter as the case maybe.” As an Ordinary Resolution 2: “That, the Directors be and hereby authorised to issue and allot 1,345,139,558 Debentures out of the stock of the Company at an issue price of 4.665 US Cents with a coupon of 5% per annum payable on redemption at the redemption date that is six (6) years from the date of issue at the redemption value of 6.252 US Cents inclusive of interest.” As an Ordinary Resolution 3: “That, each Debenture shall be linked to each Rights Offer share at the time of subscription but should be automatically delinked upon issuing and allotment to enable the Debentures and shares to be tradeable independent of each other.” As an Ordinary Resolution 4: “That, the Debenture shall be freely tradeable provided that the transfer of the Debenture from one holder to a subsequent holder shall require the approval of the Debenture Trustee appointed by the Company.” As an Ordinary Resolution 5: “That, the Directors of the Company be and hereby authorised to issue renounceable letters of Allocation which shall be tradeable as nil paid Rights with respect to the Rights Offer Shares to be listed on the Zimbabwe Stock Exchange.” As an Ordinary Resolution 6: “That the Directors be and hereby authorised to use the entire Rights Offer and Debenture offer proceeds to pay off the foreign debt set out in the Circular dated 17 January 2017.”

Signature of Shareholder ………………………………………………………………………………………………………………………

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 77 PLEASE NOTE If the address on the envelope of this letter is incorrect, please ﬁll in the correct details below and return to the Group Company Secretary.

Name …………………………………………………………………………………………………………………………………………..

Address:………………………………………………………………………………………………………………………………………

………………………………………………………………………………………………………………………………………………

Please read the notes on the reverse side hereof:

NOTES: 1) Shareholders may insert the name of a proxy or the name of two alternative proxies of the shareholder’s choice in the space provided, with or without deleting “the Chairman of the “Extraordinary General Meeting”, but such deletion must be initialed by the shareholder. The person whose name appears first on the form of proxy and whose name has not been deleted shall be entitled to act as proxy to the exclusion of those whose names follow. 2) The authority of the person signing a proxy or representing an institutional shareholder should be attached to the proxy form in the form of a Board resolution confirming that the proxy has been appointed to represent the shareholder at the Company’s extraordinary General meeting. 3) Forms of proxy must be lodged at or posted to be received at the registered office of the Group Company Secretary, Econet Park, 2 Old Mutare Road, Msasa, Harare, Zimbabwe, not less than 48 hours before the time of the meeting. 4) The completion and lodging of this form of proxy shall not preclude the relevant shareholder from attending the extraordinary General meeting and speaking and voting in person thereat to the exclusion of any proxy appointed in terms therefor should the shareholder wish to do so. 5) The Chairman of the extraordinary General Meeting may accept a proxy form which is completed and /or received other than in accordance with these instructions, provided that he is satisfied as to the manner in which a shareholder wishes to vote. 6) Any alteration or correction to this form must be initialed by the signatory/signatories

78 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY ANNEXURE C: LETTER OF ALLOCATION

Econet Wireless Zimbabwe Limited 2 Old Mutare Road Harare, Zimbabwe

RENOUNCEABLE LETTER OF ALLOCATION (“LA”) An oﬀer is hereby made to ordinary shareholders in ECONET WIRELESS ZIMBABWE LIMITED (“Shareholders”), who were registered as such as at the close of business on Friday 17 February 2017, being the Record Date, and pro rata to their shareholdings 1,082,088,944 ordinary shares plus 263,050,614 Class A shares at a subscription price of 5.00 US Cents each, and which shall be linked to a redeemable Debenture with a face value of 6.252 US cents with a subscription price of 4.665 US Cents each.

This oﬀer should be read in conjunction with the circular to Econet Wireless Zimbabwe Limited Shareholders detailing the terms and conditions of the Rights Oﬀer dated 17 January 2017 (“Circular”).

IF YOU HAVE RECENTLY SOLD ALL OR PART OF YOUR ECONET WIRELESS ZIMBABWE LIMITED SHARES, PLEASE SIGN SECTION B OF THIS LA OVERLEAF AND DELIVER THIS DOCUMENT TO THE BROKER OR AGENT THROUGH WHOM YOU SOLD YOUR ECONET WIRELESS ZIMBABWE LIMITED SHARES.

1. General The LA overleaf is a valuable document in that you can sell it via your stockbroker through the Zimbabwe Stock Exchange, even though you have not paid any money for the Rights Oﬀer Shares being oﬀered to you.

2. Allocation In terms of the Circular, Econet Wireless Zimbabwe Limited has offered you the right to subscribe at US$0.05 per Rights Offer Share for that number of Rights Offer Shares in Econet Wireless Zimbabwe Limited shown overleaf. The Rights Offer Shares you have been allocated are based on the number of ordinary shares or class A shares registered in your name at the close of business on Friday 17 February 2017, in the ratio of circa 82 new shares for every 100 ordinary shares held in Econet Wireless Zimbabwe Limited.

3. Courses of Action

3.1. Subscribe for all the shares oﬀered (ACCEPTANCE) In this case you should return this document without endorsement to FIRST TRANSFER SECRETARIES (PRIVATE) LIMITED, Harare, together with an authentic electronic transfer form or a bank certiﬁed deposit slip as proof of payment for the amount shown in the relevant section overleaf. Kindly ensure that the LA Form number is quoted on the proof of payment.

3.2. Sell your rights (RENUNCIATION) In this case, you should renounce your right to accept the Rights Offer Shares offered to you and sell your rights, via a stockbroker. This you can do by signing at the bottom of Section B of the form overleaf and by sending it to your stockbroker with your instructions to “sell the rights”. Neither the Company nor its agents shall be obliged to investigate whether the LA has been properly signed. If the rights are subsequently sold, and the person purchasing the rights wishes to subscribe for the Rights Offer Shares shown overleaf, he, she or his or her agent must complete Section C of the form overleaf and the provisions of paragraph 3.1 shall apply in the same way as it applies to the other sections.

3.3 Splitting your rights In this case, you should accept a portion of the Rights Oﬀer Shares and transfer your right to subscribe for the balance in favour of a named or unnamed person, or simply take up a portion and not sell the other portion in which case the Shares will be taken up by the underwriter.

4. Timetable

Oﬀer opens Monday 20 February 2017 Dealing in LA’s commences Monday 20 February 2017 Last day for dealings in LA’s Wednesday 8 March 2017 Latest time for splitting LA’s Thursday 9 March 2017 Rights Oﬀer closes Friday 10 March 2017

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 79 5. Signatures All alterations on/to Sections B and C must be authenticated by a full signature of the Shareholder and joint renunciations must be signed by all the Shareholders concerned.

6. New share certificates New share certificates will be posted from Monday 27 March 2017 to the appropriate address recorded overleaf, unless specific instructions to the contrary are given in writing by the person(s) concerned.

7. Discrepancy If the payment you make is less than it should be, you will still be allotted that number of Rights Oﬀer shares for which the payment is suﬃcient.

8. Oﬀshore/ Foreign Shareholders Payments must be made through telegraphic transfer, cheque or bank draft, in favour of “Econet Rights Issue” drawn in the currency of the United States dollars. Letters of Allocation accompanied by the proof of payment should be forwarded to FIRST TRANSFER SECRETARIES (PRIVATE) LIMITED, 1 Armagh Avenue, Eastlea, or Box 11, Harare, soft copies can be emailed to info@fts-net. com. LAs in favour of Shareholders whose registered addresses are outside Zimbabwe have been endorsed as required in terms of the Exchange Control Regulations (1996). In the event of any queries, foreign Shareholders are requested to contact the Group Company Secretary, Econet Wireless Zimbabwe Limited, on Tel: +263 772555144 or Email [email protected]

80 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY ECONET WIRELESS ZIMBABWE LIMITED (“ECONET” or “Company”)

APPLICATION FORM

Form No: ………….

A Number of Econet Number of Econet Number of Econet Number of Econet AMOUNT PAYABLE by Wireless Class ‘A’ Wireless Class ‘A’ Wireless ordinary Wireless Debentures 16:00 hours on shares registered in shares which may shares which may which may be 22 March 2016 your name at close be subscribed for at be subscribed for at subscribed for at of business at 17 US$0.05 per share US$0.05 per share US$0.04665 each February 2017

Name and address of shareholder(s): ……………………………………………………………………………………………………….…

…………………………………………………………………………………………………………………………………………………

ACCEPTANCE IF YOU WISH TO SUBCRIBE FOR THESE NEW SHARES WHICH HAVE BEEN OFFERED TO YOU, YOU MAY DEPOSIT OR TRANSFER YOUR MONEY TO THE FOLLOWING BANK ACCOUNT:

Account Currency: USD Correspondent Bank: Standard Chartered Bank - London Correspondent Bank BIC: SCBLGB2L Beneficiary Account Name: African Export Import Bank Beneficiary Account Number: 01270797750 Beneficiary IBAN: GB94 SCBL 6091 0412 7079 77 Beneficiary Swift Code: AFXMEGCA Reference: EWZ Rights Offer Intermediary Bank: Standard Chartered Bank, New York Intermediary Bank BIC: SCBLUS33

ALL PAYMENTS SHOULD BE MADE DIRECTLY INTO THE ABOVE BANK ACCOUNT AND THIS FORM TOGETHER WITH PROOF OF PAYMENT SHOULD BE FORWARDED TO ‘FIRST TRANSFER SECRETARIES (PRIVATE) LIMITED, 1 Armagh Avenue, Eastlea HARARE’, or email a scanned copy of the proof of payment to info@fts-net com. BY SIGNING THIS FORM YOU UNDERSTAND AND ACCEPT THAT SHOULD YOUR PAYMENT BE DISHONOURED, YOU WILL FORFEIT THE RIGHT TO TAKE UP THE RIGHTS OFFER SHARES AND YOU WILL HAVE NO FURTHER CLAIM WHATSOEVER AND INDEMNIFY ECONET WIRELESS IN THIS REGARD.

B FORM OF SPLITTING (see paragraph 3 (three) “Courses of action” of the renounceable Letter) (To be completed by the Shareholder named above if the right to subscribe for Rights Oﬀer Shares is to be renounced or if this Letter is to be split).

TO: The Directors Details of Split Required Econet Wireless Zimbabwe Limited Split No. No of Shares No of Debentures CLASSI/We, the shareholder(s) named above, would like to “A”take up 1 SHARES ------(no. of Rights Offer Shares) of the total Rights Offer Shares offered above. 2 l/We hereby renounce the balance of my/our right to subscribe for the Rights Offer Shares allocated to me/us in favor of the person(s) signing 3 the registration application form (Section C) in relation to such Rights Offer Shares, or in default of a named person, in favor of the underwriter. 4 5 Signature(s)______Date______

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 81 C REGISTRATION APPLICATION FORM

(To be completed by the person(s) to whom the right has been renounced, or his/her/their agent). (Please print).

First Name(s) ______

Surname or name of corporate body______

Address______

TO: The Directors Econet Wireless Zimbabwe Limited

I/We the person(s) named above, conﬁrm I/we have full legal capacity to contract and request you to allot the Rights Oﬀer Shares covered by this Letter in my/our name(s). I/We authorize you to place my/our name(s) on the register as members of the Company in respect of the shares so allocated, subject to the conditions set out overleaf and the Memorandum and Articles of Association of the Company and enclose herewith my/our cheque.

PLEASE SEND THE NEW CERTIFICATE TO ME/US/THE AGENT LODGING THIS APPLICATION.

Signature(s) ______Date______

82 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY ECONET WIRELESS ZIMBABWE LIMITED (“ECONET” or “Company”)

APPLICATION FORM

Form No: ………….

A Number of Econet Wireless Number of Econet Number of Econet Wireless AMOUNT PAYABLE by ordinary shares registered Wireless ordinary shares Debentures which may be 16:00 hours on in your name at close of which may be subscribed subscribed for at US$0.04665 22 March 2017 business at 17 February for at US$0.05 per share each 2017

Name and address of shareholder(s): …………………………...... ………………………………………………………………………….…

…………………………………………………………………………………………………………………………………………………

ACCEPTANCE IF YOU WISH TO SUBCRIBE FOR THESE NEW SHARES WHICH HAVE BEEN OFFERED TO YOU, YOU MAY DEPOSIT OR TRANSFER YOUR MONEY TO THE FOLLOWING BANK ACCOUNT:

TO: The Directors Details of Split Required Econet Wireless Zimbabwe Limited Split No. No of Shares No of Debentures I/We, the shareholder(s) named above, would like to take up 1 ------ORDINARY(no. of Rights Offer Shares) of the total Rights Offer Shares offered above. 2 SHARES l/We hereby renounce the balance of my/our right to subscribe for the Rights Offer Shares allocated to me/us in favor of the person(s) signing 3 the registration application form (Section C) in relation to such Rights Offer Shares, or in default of a named person, in favor of the underwriter. 4 5 Signature(s)______Date______

ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY 83 C REGISTRATION APPLICATION FORM

(To be completed by the person(s) to whom the right has been renounced, or his/her/their agent). (Please print).

First Name(s) ______

Surname or name of corporate body______

Address______

TO: The Directors Econet Wireless Zimbabwe Limited

PLEASE SEND THE NEW CERTIFICATE TO ME/US/THE AGENT LODGING THIS APPLICATION.

Signature(s) ______Date______

84 ECONET WIRELESS ZIMBABWE LIMITED - CIRCULAR TO SHAREHOLDERS OF THE COMPANY