Block of MTN shares to be sold at a discount

1 Jun 2007

The National Empowerment Fund plans to sell its 1.5% stake in cellco MTN Group to a range of previously disadvantaged groups at a discount, according to trade and industry deputy director-general Lionel October. At the current MTN share price, the offering of 1.5%, or 30 million shares, would have a value of about ZAR3billion (USD420 million). However, the fund would not realise this amount as the shares would be offered at a discount. As usual in such transactions, it is likely that future beneficiaries of the transaction will be prevented from disposing of their shares for a while to prevent the market being flooded with MTN shares, which would depress the price. The National Empowerment Fund was allocated the shares by the government, which obtained them during the MTN licensing process. A further announcement regarding the sale is expected at the end of June.

South Africa, MTN Group