Vodafone plans to sell approximately 90 million ordinary shares (5.2%) in Vodacom to institutional investors by way of an accelerated bookbuild process.
Following Vodacom’s recent acquisition of a 35% interest in Safaricom, Vodafone increased its ownership in Vodacom from 65.0% to 69.7%.
At the time of the deal, it was expected that Vodacom’s free float would decline to approximately 18%.
As part of the Safaricom transaction, Vodafone committed to Vodacom that it would sell a sufficient number of shares to ensure that Vodacom will meet the 20% minimum free float requirement on the JSE.
The move will also restore Vodafone’s shareholding in Vodacom to a percentage that is similar to what it held prior to the Safaricom transaction.
“Vodafone remains committed to Vodacom and intends to retain a controlling majority shareholding in Vodacom for the long term,” the operator said.
Vodacom issued the following statement on Wednesday:
“Vodacom has been informed by its majority shareholder, Vodafone Group Plc, that it has sold 90 million ordinary shares in Vodacom at R165 per share to institutional investors through an accelerated book-build process.
“This equates to 5.2% of Vodacom’s share capital and values the 90 million tranche at R14,85 billion.
“The placement ensures that Vodacom meets the JSE’s free float requirement of more than 20%. Vodacom obtained a temporary dispensation from the JSE to dip below this level to facilitate its circa R35 billion purchase of a 35% stake in Safaricom from Vodafone.
“Yesterday’s placement means that Vodafone’s shareholding in Vodacom has been restored to levels that are broadly similar to the 65% it held ahead of the Safaricom transaction.
“In a regulatory announcement in the UK yesterday, Vodafone said it “remains committed to Vodacom and intends to retain a controlling majority shareholding in Vodacom for the long-term.”
“Following yesterday’s placement, Vodafone holds a circa 64.5% stake in Vodacom.”