PIC mulls in­creas­ing Vo­da­com stake

Lesotho Times - - Business -

JO­HAN­NES­BURG — The Public In­vest­ment Cor­po­ra­tion (PIC), Africa’s big­gest money manager, is con­sid­er­ing in­creas­ing its stake in Vo­da­com Group Ltd by buy­ing gov­ern­ment-owned shares in the wire­less op­er­a­tor, peo­ple familiar with the plans said.

The Pre­to­ria-based PIC, which al­ready owns 3.19 per­cent of Jo­han­nes­burg-based Vo­da­com, is seek­ing ad­vis­ers for a deal that could make it the com­pany’s sec­ond-largest share­holder af­ter UK car­rier Voda­fone Group Plc, said one of the peo­ple, who asked not to be iden­ti­fied be­cause the pro­posal hasn’t been made public. The gov­ern­ment’s 13.9 per­cent stake is worth R30.5 bil­lion at Vo­da­com’s cur­rent share price.

South Africa is seek­ing to sell state-owned as­sets to help plug a R225 bil­lion fund­ing short­fall at the coun­try’s state-owned power util­ity Eskom Hold­ings SOC Ltd. and has pledged to raise R20 bil­lion this year and R3 bil­lion next year.

Africa’s most-in­dus­tri­alised econ­omy faces the risk of credit-rat­ing down­grades and power cuts for at least two years be­cause Eskom can’t meet de­mand af­ter de­lay­ing in­vest­ment in new plants.

The PIC man­ages the ma­jor­ity of South African gov­ern­ment worker pen­sion funds and its in­vest­ments ac­count for 13 per­cent of the mar­ket cap­i­tal­i­sa­tion of stocks traded in Jo­han­nes­burg, the com­pany said on its web­site.

Di­rect Sale Vo­da­com, which had 61.1 mil­lion cus­tomers across five African coun­tries at the end of last year, favours a di­rect, off-mar­ket sale of the gov­ern­ment’s stake as it would avert a share over­hang, said an­other per­son familiar with Vo­da­com’s think­ing. The per­son asked not to be iden­ti­fied be­cause Vo­da­com hasn’t com­mented pub­licly on the mat­ter. An over­hang refers to a block of shares re­leased onto the mar­ket in one go, send­ing the price lower.

Vo­da­com stock has gained 15 per­cent this year, out­pac­ing the 8.7 per­cent in­crease in the shares of Jo­han­nes­burg-based MTN Group Ltd, Africa’s big­gest mo­bile phone com­pany.

Vo­da­com is 65 per­cent owned by New­bury, Eng­land-based Voda­fone and has op­er­a­tions in Le­sotho, Tan­za­nia, the Demo­cratic Repub­lic of Congo and Mozam­bique.

— Bloomberg.

APART from South Africa Vo­da­com has op­er­a­tions in Le­sotho, Tan­za­nia, the Demo­cratic Repub­lic of Congo and Mozam­bique.

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