Cell C valued at R22 billion

 ·28 Sep 2015

South Africa’s third largest mobile operator, Cell C, is valued at R22 billion rand ($1.6 billion) by its owners, according to a Bloomberg report.

Telkom, the country’s fourth largest mobile operator, has reportedly shown interest in acquiring Cell C and is prepared to pay no more than R18 billion ($1.3 billion), Bloomberg said, citing people familiar with the situation.

Dubai-based Oger Telecom noted in March 2015 that it was looking to sell its 75% stake in Cell C. It has since put a price-tag on the company, which reportedly includes R14 billion of debt.

Telkom on Monday (28 September) warned shareholders that it “is in discussions” which may have a material effect on its share price.

The group’s CEO Sipho Maseko recently expressed some interest in buying Cell C, calling it an “interesting proposition”.

“At the right price, I’m a buyer,” Maseko said.

Last month Business Day reported that six groups had displayed interest in acquiring the operator.

The business publication cited a direct quote from Oger Telecom’s chief legal officer and deputy CEO, Mazen Abou Chakra.

Cell C chief executive Jose dos Santos, added weight to the rumours last week, saying that the company has engaged with its competitors over a potential acquisition. Nothing material has come of the discussions, however, Dos Santos said.

“People talk all the time,” he said.

He added that the discussions have not only been with local players, but international players too.

Cell C profitable

Dos Santos said that the company is making a month-on-month profit, and has been for several quarters already.

He said that the company now has just shy of 22 million customers. This is compared to MTN SA, which has a subscriber base of 28.5 million, and Vodacom, with 31.4 million active users.

Telkom’s mobile customer base is at a modest 2.2 million.

Vodacom, which has networks in Tanzania, the Democratic Republic of Congo, Mozambique, and Lesotho, has a market cap at approximately R203.8 billion.

MTN, meanwhile, has a market cap exceeding R326.6 billion, serving 230 million customers in 21 countries in Africa and the Middle East.

More on Telkom and Cell C

Telkom ‘discussions’ fuel Cell C acquisition rumour

We are profitable: Cell C CEO

Telkom interested in buying Cell C: report

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