Vodacom’s proposed acquisition of a 55% stake in Vodafone Egypt cleared a crucial hurdle today when Vodacom minority shareholders overwhelmingly voted in favour of the transaction. At a General Meeting this morning, shareholders also approved resolutions that pave the way to fund the circa R41 billion ($2.7 billion) transaction.
Subject to the final outstanding regulatory approvals, Vodacom will fund the acquisition of Vodafone Group plc’s 55% stake in Vodafone Egypt by issuing 242 million new ordinary shares at R135.75 per share in addition to around R8.2 billion ($548 million) in cash.
“This is an exciting and important milestone for Vodacom as the acquisition of Vodafone Egypt will be transformational in our evolution from a telco to a techco,” said Vodacom Group CEO Shameel Joosub.
“This is a transaction that presents significant diversification and growth opportunities for our shareholders.
“With over 80% of Egypt’s 100 million population unbanked, Vodacom sees enormous potential to leverage our financial services platforms, global partnerships and best practices in a significant market.”
Vodacom continues to work towards closing the transaction before the end of its financial year March 2022. However, the deal remains conditional upon receipt of certain approvals from the JSE, the National Telecom Regulatory Authority of Egypt (NTRA) and Egypt’s Financial Regulatory Authority (FRA).
Given the related-party nature of the transaction, Vodacom has ensured appropriate governance controls were put in place so that the deal is executed and concluded on an arm’s length basis. As a result, Vodafone, which currently holds a 60.5% stake in Vodacom Group, was precluded from voting on the approval of the transaction at the General Meeting.
