Vodacom’s R16.4bn BEE deal – largest in ICT sector – drives transformation
Cliffe Dekker Hofmeyr has acted as legal adviser to Vodacom and YeboYethu in the BEE deal
Last week, on September 14, Vodacom Group and YeboYethu completed a R16.4bn black economic empowerment (BEE) transaction – the biggest such deal in the information and communications technology sector to date. Cliffe Dekker Hofmeyr (CDH) acted as lead legal adviser on the deal to both Vodacom and YeboYethu.
This pioneering deal is a tribute to the 10-year-long journey that Vodacom, YeboYethu and CDH have walked together to provide better opportunities for South Africans and drive transformation in the country.
Christopher Baird, director in the corporate and commercial practice at CDH and lead legal adviser, says he is proud to have played a role in the deal. “From its first BEE deal when YeboYethu was initially formed in 2008 through to this one, CDH has been beside Vodacom and YeboYethu throughout the journey.”
The significance of the deal for transformation is highlighted by Verushca Pillay, CDH’s BEE sector and director in the corporate and commercial practice, who explains how the deal has played a vital role in progressing transformation.
“In addition to delivering the best returns to shareholders of any listed BEE deal, the deal will see significant value being delivered to more than 85,000 black shareholders and 8,500 Vodacom staff. By ultimately transferring economic ownership into the hands of black South Africans, deals of this nature are vehicles for the practical fulfilment of transformation,” says Pillay.
Nkcubeko Mbambisa, a director at CDH who also advised on the deal, adds that the current YeboYethu deal proved to be extremely profitable for investors. “Through YeboYethu, for each share owned – having been originally issued at only R25 each – investors received a dividend of R73 and will now have a stake in Vodacom Group. The deal provides shareholders with greater exposure to foreign investments through Vodacom Group shares.”
Baird says: “The first YeboYethu deal, after running successfully for 10 years, was due to end in October. And with an ending comes a new beginning, as this latest deal – also carrying a 10-year term – sees the commencement of our next chapter together with Vodacom and YeboYethu.”
He adds that deals of this nature continue to be critical for driving greater economic transformation. “CDH is proud to have collaborated on and been a part of this innovative deal with Vodacom and YeboYethu. We remain committed to the facilitation of commercial transactions that align investors’ expectations and the desired commercial outcomes with the objectives of transformation.”
This article was paid for by Cliffe Dekker Hofmeyr.