Vodafone supports Vodacom BEE plans
Vodafone group CEO Vittorio Colao has thrown his weight behind plans to sell shares in Vodacom to black investors, saying that the deal should be broad-based.
A new black economic empowerment deal (BEE) would further boost Vodacom’s empowerment credentials and help it meet the government’s revised requirements.
Vodafone owns a 65% interest in Vodacom and has no intentions of losing control of the business, said Colao.
"We support any decision regarding BEE. We would also like it to be broad-based."
Vodacom is working on a new BEE deal that is likely to be finalised before its existing empowerment agreement at its South African operations expires in 2018. Vodacom sold shares in the South African operations in 2008 to black members of the public, Thebe Investments and Royal Bafokeng Holdings for R7.5bn.
It is not clear, however, whether the new deal would involve the sale of equity at group level. Another option would be for a deal to be concluded in the South African operations.
Vodacom CEO Shameel Joosub said Vodacom was evaluating options.
"When the BEE deal at SA expires, we have to have a new deal," he said.
The Public Investment Corporation (PIC) was reported to be in discussions to sell a portion of its 13% stake in Vodacom to black investors.
In January, Bloomberg reported that Vodacom planned to buy back part of the PIC’s stake. The shareholding could then be listed as a separate entity restricted to black investors.
The Vodacom BEE deal was estimated to be R15bn, which would make it one of the biggest BEE deals in the country.
In 2016, MTN sold a 4% stake for about R10bn to black investors through a scheme called MTN Zakhele Futhi.