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CellSAf challenges Cell C’s restructuring plan

30 Nov 2016

South African Black Economic Empowerment (BEE) entity CellSAf consortium, which holds a 25% stake in the parent company of mobile operator Cell C, has reportedly filed a legal challenge against the cellco’s planned restructuring. According to Reuters, CellSAf reportedly claimed that it wasn’t afforded an option to comment on the restructuring plan – under which Johannesburg-based pre-paid airtime distributor Blue Label Telecoms will acquire 45% of Cell C for ZAR5.5 billion (USD399 million) via its subsidiary The Prepaid Company (TPC) – before it went ahead.

As previously reported by TeleGeography’s CommsUpdate, the two sides have been in discussions on the planned restructuring since December 2015. Blue Label, through TPC, will settle the ZAR5.5 billion acquisition price with ZAR2.0 billion via a vendor consideration placement with Net1 UEPS Technologies at a price of ZAR16.96 per share, while the remaining ZAR3.5 billion will be settled using available cash and funding facilities. Cell C is wholly owned by holding company 3C Telecommunications, which is itself owned by Oger Telecom South Africa (60%), CellSAf consortium (25%) and Lanun Securities (15%). Following the conclusion of the deal, 3C Telecommunications (CellSAf and Oger Telecom) will hold 30% of the cellco’s equity, Blue Label will own 45%, while Cell C’s staff and management will be in charge of the remaining 25%.

South Africa, Cell C

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