PIC abandons sale of shares in Vodacom to black investors
A PLANNED sale of shares in Vodacom Group by the Public Investment Corporation (PIC) to black investors had been abandoned, said sources familiar with the situation.
The proposed sale by Africa’s biggest money manager, which oversees government workers’ pensions, to a consortium including former Vodacom executive Romeo Kumalo would have boosted the Vodafone Group unit’s black shareholding, said the sources, who asked not to be identified as the negotiations were private.
Vodacom would continue to seek potential black shareholders, one of the sources said.
An increase in Vodacom’s black shareholding would improve the wireless carrier’s chances of winning South African high-speed internet spectrum in a proposed auction that the Independent Communications Authority of SA, the industry’s regulator, said might raise $1 billion (R14bn) early next year.
Companies needed 30 percent black ownership to place a bid, according to rules published by the regulator.
The condition is part of South Africa’s push to increase black ownership of industries.
Vodacom is 18.7 percent owned by black investors, compared with 38.75 percent for MTN Group. Both companies are based in Johannesburg.
“We are considering the contents of the ITA (invitation to apply), including the various obligations in its entirety and intend then to take the necessary steps to comply with the requirements of the regulator,” Vodacom’s spokesman Byron Kennedy said in an emailed response to questions on the spectrum auction.
He declined to comment on the PIC.
Limbo
The allocation of spectrum in South Africa has been in limbo for almost five years in part due to deliberations by the telecoms ministry and the regulator over broadband policy.
The Independent Communications Authority of SA’s decision to kick-start the auction process last month was thrown into doubt when Minister Siyabonga Cwele said he would take legal action against the regulator for failing to consult with his ministry.
The government last year sold its 14 percent stake in Vodacom to the PIC to raise funds to support expansion by its power utility.
The PIC was in talks with various black investors seeking to buy a stake, chief executive Dan Matjila said.
Vodacom shares fell 0.75 percent to R158.25, valuing the company at about R235.4bn on Friday. – Bloomberg