Cell C CEO Jorge Mendes addresses staff during the mobile operator's brand launch against a backdrop of the old logo. Image: Nicola Mawson.
The Independent Communications Authority of SA (Icasa) approved the transfer of Cell C’s network licences to Blue Label Telecoms.
The licences will remain under Cell C’s name, will now fall under the control of The Prepaid Company (TPC), a subsidiary of Blue Label.
The transaction will see Blue Label increase its stake in Cell C to 53.57%, giving it majority ownership
Another giant in the telecoms industry, MTN, raised concerns about the deal in connection with competition in the industry.
It called for market fairness and urged ICASA to evaluate the deal with a fine tooth comb, but MTN further said that the transfer may not warrant rejection.
MTN further stated that previous arrangements between itself and Cell c was irrelevant to this transaction.
In August last year, Business Report, reported that Blue Label Telecoms’ bid to increase its shareholding in mobile operator Cell C was moving closer to the finish line, with regulatory hearings set to be completed by the end of the year (2024).
Blue Label, which distributes prepaid products as well as virtual merchandise and value-added services, last year reported revenue of R89.3 billion in the year to May when PIN-less top-ups – a recent line of offerings – are included.
This compares with R76.8bn reported in the previous year.
Excluding PIN-less top-ups, revenue would have been R14.6bn.
Headline earnings per share came in at 76.08 cents, a year-on-year gain of 40%.
The company continues to seek bolt-on offerings to take advantage of its current infrastructure, co-founder and CEO Brett Levy told Business Report.
It continues to make investments in digital distribution infrastructure and fintech innovation.
Levy said last year that until regulatory approval for its bid for a majority stake in Cell C was approved, it would be “business as usual”.
He explained that being able to account for Cell C as a subsidiary would make it easier to report than having to include it as an associate as is currently the case.
Cell C CEO Jorge Mendes told Business Report that the mobile operator, which launched in 2001 and unveiled a refreshed brand in the middle of this month, was now looking to enter the enterprise market and was in discussions with companies to lease items such as servers and cloud offerings.
Mendes said the operator did not aim to take on the likes of Vodacom and MTN, which already had substantial enterprise segments, but felt there was enough space for it to enter this market as well.
“We certainly don’t intend to be building a whole product stack. We want to resell,” said Mendes.
Mendes adds that Cell C’s brand refresh was gaining traction as it had brought with it more energy. “It’s really a new positioning for the brand.”
BUSINESS REPORT