JOHANNESBURG - As a result of the move Cell C's net borrowings have been reduced to less than R6bn.
This means that Blue Label's wholly-owned subsidiary, The Prepaid Company, now owns 45% shares in Cell C.
The JSE-listed prepaid airtime, electricity and ticket distribution company's shareholders approved a move to recapitalise Cell C at a general meeting last month following 18 months of negotiations.
The sale of stakes in Cell C is part of efforts to slash the mobile operator’s debts from R20bn to R6bn.
Click here to read: Cell C wants to cut debt by selling stake
Net1 UEPS Technologies was a party to the umbrella restructure agreement with Cell C in which it was going to buy a 15% stake in Blue Label worth R2bn, while in turn, Blue Label was to buy a stake in Cell C.
However, in June the agreement with Blue Label was terminated.
Instead, Net1 said that it will continue to pursue its acquisition of a 15% stake of Cell C for a cash consideration of R2bn, but through surplus cash and debt.
Meanwhile, Blue Label also said it had implemented the initial acquisition of 47.37% shares of 3G for a purchase consideration of R900m.
This means that the acquisition of the remaining 52.63% of the issued share capital of 3G Mobile for a purchase consideration of R1bn, which was subject to the initial acquisition becoming unconditional in accordance with its terms and any regulatory approvals, can now proceed.
In June Blue Label concluded an agreement with 3G Mobile and its shareholders to acquire 100 percent of 3G’s shares for R1.9bn, through its wholly-owned subsidiary The Prepaid Company.
3G Mobile is one of Africa’s largest distributors, and financiers, of mobile devices and handsets to major retailers and cellular network providers.