Cell C says it will continue to work proactively with all stakeholders to improve its liquidity, debt profile and long-term competitiveness as part of its turnaround strategy.
While a new recapitalisation is being negotiated, there is an informal debt standstill and debt payments have been suspended, majority shareholder Blue Label Telecoms said in a statement on Tuesday (4 August).
“Although Cell C’s lenders are entitled to call up the entire debt owed, they have not accelerated debt payments and have held off on taking action in order to facilitate a commercial solution.
“The non-payment is not a surprise to lenders that understand the Cell C turnaround strategy.
“Good progress in a complex recapitalisation is being made. Discussions to seek alignment among all stakeholders are being held and term sheets will need to be concluded.”
Blue Label said that a focused strategy and correctly capitalised balance sheet will lead to better leveraging of assets.
It added that the local mobile market is in a mature phase, and the long term growth of the industry, in general, will be determined by the ability to deliver innovative service offerings, while assessing over-investment in capital hungry infrastructure.
“There is belief in Cell C’s long-term prospects, and the new leadership team is focused on the journey to turn the company into a profitable, innovative player in the local telecoms industry and is confident the organisation will overcome its challenges,” said Cell C chief executive, Douglas Craigie Stevenson.