Blue Label stockholders to vote on Cell C deal
Blue Label Telecoms is pushing ahead with a plan to recapitalise Cell C. Under the plan, it’ll become a 45% shareholder through subsidiary The Prepaid Company.
Blue Label has signed the “final equity transaction agreements” for the planned recapitalisation. It’ll now call a general meeting of shareholders by the end of July to seek their approval of the amended terms. If approved – it already has 53% of shareholders’ backing – the recapitalisation should be implemented in early August.
Earlier in June, Net1 UEPS Technologies said it had decided not to subscribe for shares in Blue Label as part of the Cell C recapitalisation, but would still pursue a planned direct acquisition of 15% of the mobile operator for R2 billion.
At the time, Blue Label said that as a result of Net1’s decision, it had signed binding subscription agreements with alternative third-party investors worth R2 billion. This placement’s been increased to R2.75 billion, at R15 per Blue Label share.
Under the plan that’ll be presented to shareholders, The Prepaid Company’s subscription remains at 45% of Cell C for a price of R5.5 billion.
The Prepaid Company’s agreed to provide “liquidity support”, to the extent required, in the form of interest-bearing subordinated loans of up to $60 million, to a special purpose vehicle set up to hold shares in Cell C. – TechCentral