Blue Label concludes recapitalisation of Cell C

22 Sep 2022

Blue Label Telecoms, the largest shareholder in Cell C, has revealed that the years-long recapitalisation of the mobile operator – which owed certain secured lenders a total of ZAR7.3 billion (USD412 million, fixed as of November 2019) – has finally been completed. According to a company press release, Blue Label concluded ‘binding long-form agreements with Cell C and various Cell C financial stakeholders, including certain shareholders and creditors of Cell C’, with all conditions precedent now met. Cell C CEO Douglas Craigie Stevenson said: ‘The recapitalisation was the final and critical pillar of Cell C’s turnaround strategy; deleveraging the balance sheet, providing liquidity to operate, and putting the company on a trajectory of growth and long-term sustainability.’ Under the restructuring plan, Blue Label will provide liquidity via a secured loan of ZAR1.46 billion. The Prepaid Company (TPC), a Blue Label subsidiary, will hold 49.53% of shares in Cell C after completion of the restructuring; additionally, an amount of ZAR1.1 billion owed by Cell C to Comm Equipment Company (a wholly owned subsidiary of TPC) will be deferred and repaid in equal monthly instalments over 60 months. However, Cell C’s debt holders took a huge haircut as part of the recap – securing only ZAR0.20 for each ZAR1 they provided.

South Africa, Blue Label Telecoms, Cell C