Cell C today announced that conditional agreements have been signed for the proposed recapitalisation of the company.
The proposed recapitalisation will reduce the net debt of the company to approximately R8 billion and enable the company to continue to deliver on its growth strategy in a sustainable manner.
Blue Label Telecoms will contribute R5.5 billion in a subscription for 45% of Cell C's total issued share capital, which is an increase in their prospective holding from the 35% announced previously.
The Management and staff of Cell C will subscribe for 25% of the issued capital and 3C Telecommunications will subscribe for the sufficient new equity to hold the remaining 30% of the total issued share capital.
“We are delighted to announce this partnership with Blue Label Telecoms and Cell C management and staff. This transaction allows Oger Telecom and 3C to remain invested in Cell C and participate in the value creation arising from this enhanced strategic relationship. We look forward to seeing Cell C achieving new heights,” said Mr Mohammed Hariri, Chairman of Cell C and Oger Telecom.
“The recapitalisation provides a sustainable growth platform to build on our successes as we continue to drive customer value to realise our exciting growth potential. This is a transformational transaction for Cell C and we are extremely excited about the strengthening of our relationship with Blue Label Telecoms,” said Jose Dos Santos, Cell C Chief Executive Officer.
The proposed recapitalisation is subject to funding of all parties and necessary regulatory approvals.
The recapitalisation is expected to be implemented by 18 November 2016.