Cape Town – Airtime seller Blue Label said on Monday that it has fully implemented its recapitalisation of mobile operator Cell C.
The completion of the recapitalisation has resulted in Cell C’s net borrowings being reduced to below R6bn, it said in a statement on Monday.
Blue Label’s wholly-owned subsidiary, The Prepaid Company, now owns 45% of the issued share capital of Cell C.
Blue Label’s subscription remains unchanged at 45% of Cell C for a subscription price of R5.5bn with Blue Label agreeing to provide liquidity support, to the extent required, in the form of interest bearing subordinated loans of up to $60m to a special purpose vehicle set up to hold shares in Cell C.
In addition, Blue Label said that The Prepaid Company’s R900m acquisition of 47.37% of 3G Mobile, one of Africa’s largest mobile distributors, was also implemented.
The 3G acquisition is part of a larger 100% takeover deal worth R1.9bn.
The remaining 52.63% will be concluded in a R1bn deal between Blue Label and 3G Mobile and its shareholders: Wild Rose Capital, Newshelf 1312, Malewell Investments, Investec Bank, Jonathan Beare and DBF Capital Partners.
Blue Label said 3G Mobile would be used to expand into the financing and supply of mobile devices, handsets and allied products to distribute into the low cost smartphone market.
"Both of these functions supplement Blue Label's strategic objectives to provide value added services to both Cell C and its own customer base.
“3G Mobile provides the ideal platform to consolidate Blue Label's low cost and certified pre-owned mobile handset divisions into a consolidated group," Blue Label said in a statement in June.
3G Mobile is one of Africa’s largest distributors and financiers of mobile devices and handsets to major retailers and cellular network providers.
It has distribution rights for all major tier one and tier two mobile device and handset manufacturers - including Apple, Samsung, Huawei, HiSense, ZTE and Nokia - and operates in eight African countries.Follow Fin24 on Twitter, Facebook, Google+ and Pinterest. 24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.