MTN empowerment scheme, MTN Zakhele will begin restricted trading of its ordinary shares from 25 November 2013 on an online trading platform and through a dedicated call centre.
The operator said that existing MTN Zakhele ordinary shareholders and eligible black people or black groups need to register online or through the call centre from 1 November 2013, in order to be able to buy and/or sell shares from 25 November 2013.
The R8.1 billion MTN Zakhele transaction was concluded in November 2010 as part of MTN’s ongoing efforts to further its BBBEE objectives in South Africa.
The scheme was funded through:
- R1.6-billion brought in by around 121,000 ordinary people;
- Almost R1.3-billion in MTN donations;
- Vendor funding of R3.2-billion from MTN;
- And investment banks which paid in R2.2-billion in return for class A and class B preference shares.
MTN Zakhele owns approximately 4% of MTN Group’s total issued ordinary shares.
The ordinary shares in MTN Zakhele are owned by approximately 120,000 black investors.
With the three year Minimum Investment Period having passed, during which no trading in MTN Zakhele ordinary shares was permitted, these investors are able to sell their MTN Zakhele shares to eligible, registered buyers, to buy more MTN Zakhele ordinary shares or to continue to hold their MTN Zakhele ordinary shares.
MTN Zakhele chairman, Thulani Gcabashe says that due to the strong performance of the MTN share price and dividends received, the scheme has been able to reduce certain of its debt obligations more quickly than anticipated, and that is good news for investors.
“The success of MTN Zakhele is dependent on the performance of the MTN share price, as well as the ongoing receipt of dividends to service its funding commitments.”
“The implementation of the refinancing proposed at the July 2013 AGM is expected to improve the total returns to shareholders, as less funds will be required to service the more expensive notional vendor funding owed by MTN Zakhele to MTN.”
An invitation was issued to the black public (individuals and groups) to participate in the growth of the MTN Group through subscribing for MTN Zakhele shares at R20 a share, with a minimum purchase of 100 shares for R2,000 in order to qualify.
The offer generated widespread interest across South Africa, raising R2.78 billion from black investors, a subscription level of 1.7 times.
In afternoon trade shares in MTN traded at R196.68 on the JSE.