Chris Spillane and Ruth David
THE Public Investment Corporation (PIC), Africa’s biggest money manager, was considering increasing its stake in Vodacom Group by buying government-owned shares in the cellphone operator, people familiar with the plans said yesterday.
The PIC, which already owns 3.19 percent of Vodacom, is seeking advisers for a deal that could make it the company’s second-largest shareholder after UK carrier Vodafone Group, said one of the people, who asked not to be identified because the proposal has not been made public.
The government’s 13.9 percent stake is worth R30.7 billion at Vodacom’s current share price.
South Africa is seeking to sell state-owned assets to help plug a R225bn funding shortfall at the country’s state-owned power utility Eskom and has pledged to raise R20bn this year and R3bn next year.
Africa’s most-industrialised economy faces the risk of credit-rating downgrades and power cuts for at least two years because Eskom cannot meet demand after delaying investment in new power plants.
The PIC managed the majority of government worker pension funds and its investments accounted for 13 percent of the market capitalisation of stocks traded on the JSE, the company said on its website.
Vodacom, which had 61.1 million customers across five African countries at the end of last year, favoured a direct, off-market sale of the government’s stake as it would avert a share overhang, said another person familiar with Vodacom’s thinking. The person asked not to be identified because Vodacom has not commented publicly on the matter.
The Treasury spokeswoman Phumza Macanda could not immediately comment and asked for e-mailed questions.
Vodacom is 65 percent owned by Newbury, England-based Vodafone and has operations in Lesotho, Tanzania, the Democratic Republic of Congo and Mozambique.
The stock has gained 15 percent this year, outpacing the 10 percent gain in the shares of Johannesburg-based MTN Group, Africa’s biggest cellphone phone company. Vodacom’s share price dropped 0.49 percent to close trading at R147.53 on the JSE yesterday. – Bloomberg