Blue Label's share price soars on rumours of China Mobile's bid for Cell C
CAPE TOWN – JSE-listed Blue Label's share price soared 12 percent on Tuesday after media speculation mounted in media that China Mobile was in talks to acquire, South African mobile company and one of the top 4 leading network providers in the country, Cell C.
A sale of Cell C would benefit Blue Label, whose investment in the company has been a massive liability.
However, Cell C said in a statement on Thursday: "We cannot comment on behalf of China Mobile who may be in negotiations with various mobile operators around the world. Cell C will keep the door open to any conversations that will assist the company’s future viability".
The embattled operator has been prone to takeover speculation with rumours that Telkom was eyeing a takeover earlier this year, which amounted to hot air. Cell C has lost ground to rivals MTN and Vodacom.
In June ratings agency S&P Global Ratings downgraded Cell C to selective default.
Blue Label, which owns 45 percent of Cell C, last month said that trading losses and debt woes at the embattled mobile operator helped push it into a R6.6bn loss for the year to end-May. Cell C's annual results for the year ended May 2019 published last month revealed a net loss of R8 billion for the period.
Blue Label to deleverage its balance sheet recently announced it would raise about R1bn through asset sales to pay off its debts.
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