Zambia has dissolved the board of Libya-controlled Zamtel and appointed a new acting CEO, the government said on Tuesday, a day after it announced plans to seize 75 percent in the fixed-line operator from owner LAP Green Networks.
The government said in a statement it would restructure the ownership of Zamtel to ensure Zambians owned the bulk of the company.
"The President has ordered the dissolution of the board of Directors of Zamtel," Lusaka's State House said in the statement.
Zambia's finance minister said on Monday the government planned to take back the 75 percent stake, which was sold by the previous administration to the Libyan operator for $257 million.
A government inquiry in November ruled the 2010 transaction illegal. Zambia last week seized bank accounts belonging to Zamtel as part of a money-laundering investigation.
The company has denied any wrongdoing.
"Our acquisition was made through an open, transparent and competitive bidding process, overseen by well-respected international professional organisations and in strict adherence to Zambia's established legal framework," LAP Green Networks said in a statement.
"We hope this situation can still be amicably resolved, and we welcome an opportunity to work with the Zambian government to achieve this," it said.
Since his election in September on promises to fight corruption, Zambian President Michael Sata has chipped away at several deals made during the administration of his predecessor Rupiah Banda.