Vodacom may consider separate listing of its financial services unit

Vodacom may consider a separate listing of its financial services business in SA to unlock value, seeking to address what CEO Shameel Joosub says is a stockmarket discount to the carrier’s sum-of-parts worth.

The overall company, which also includes operations in Tanzania and Mozambique, trades in Johannesburg and could look at whether a carve out of the financial services unit makes sense, he said in an interview on Monday.  

“We are looking at how to give more disclosure so that the market gives us credit for our assets,” the CEO said. “If not, we will look at optionality on whether to list some,” he said.

The company, which last week agreed to buy a majority stake in Vodafone’s Egypt unit, is also separating its telecoms towers portfolio into a new unit. The group won’t look to sell the masts but would rather seek partners to grow the business, Joosub said. 

Vodacom is also looking for partners to grow fibre networks in operations outside of its home market, the CEO said. The company last week agreed to buy a minority stake in a vehicle housing SA fiber companies Vumatel and Dark Fibre Africa. The majority owner is a unit of Remgro, billionaire Johann Rupert’s investment firm. 

Joosub’s comments come as Africa-focused telecoms firms look to wring more value out of their continent-wide operations. Vodacom rival MTN is working on a deal to sell and lease back SA masts and has had its financial-technology business valued at R87bn ($5.7bn) ahead of a potential spinoff in 2022.

The stock traded down 1.4% at 4.46pm on Monday, and has gained 11% in 2021. By contrast, MTN has surged 164% in 2021 and surpassed Vodacom’s market capitalisation along the way. 

Vodacom is more than 60% owned by the UK’s Vodafone, according to data compiled by Bloomberg.

Update: November 15 2021
This story has been updated with new information.

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