CompCom green-lights Cell C's takeover

In its pursuit of growth, the telco is handing over to its biggest shareholder

CompCom green-lights Cell C's takeover
Blue Label Telecom moves closer to taking control

The takeover of Cell C, one of South Africa's top-tier telecom operators, has been in the works since last year.

JSE-listed Blue Label Telecom, the company's biggest shareholder indicated interest in the carrier at the business end of last year, and the process has been subject to regulatory approval.

A new turn of events finds the deal moving forward. South Africa's Competition Commission (CompCom), the body responsible for overseeing the country's restrictive business practices, has just given Blue Label the go-ahead to move forward with the process.

CompCom has not only green-lit the merger but also nudged the Competition Tribunal, a court of first instance attending to competition-related matters, to follow suit, noting that the proposed takeover does not in any way raise any public interest concerns.

Given the state of affairs, the Tribunal is likely to also approve. Objections from a stakeholder with indirect connection with CellC, CellSAf may not be detrimental to the deal.

In an earlier wider-ranging conversation with the telco, learned that CellSAf does not hold any direct shares in Cell C. However, it holds a 25% direct shareholding in 3C Telecoms, whose shareholding flows through to the special purpose vehicle with a share ownership of 4.04% in Cell C.

"Engagements and consultations have been robust and transparent with stakeholders as appropriate and within the required governance parameters throughout this process," the company shared.

CellSaf In February, Blue Label co-CEO Brett Levy said that The Prepaid Company (TPC), an entirely owned subsidiary of the company, plans to increase its 49,53% stake in Cell C to 53%, which would move it from biggest shareholder to controlling stakeholder before the end of the year.

TPC, Blue Label, and the rest of the companies directly and indirectly controlled by the latter, will be collectively referred to as the acquiring party throughout the process.

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