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SA government mulling Vodacom stake sale

The government of South Africa is reportedly considering divesting its 14% stake in Vodacom, worth around $2.3 billion.

While an institutional sale is more likely than a private one, majority shareholder Vodafone – which holds a 65% stake in Vodacom – may wish to acquire the stake.

The South African government has reportedly contacted financial advisors regarding the sale, although discussions are believed to be very much in the preliminary stages. It has been speculated that the government may use the proceeds to revive the ailing state power utility, Eskom Holdings.

A government statement on the sale read: “When government takes such decisions, it would have to handle information with extreme care, bearing in mind that some of the entities are listed and any decision involving them is market sensitive and is governed by strict laws and regulations which must be abided by at all times. At appropriate times government has an obligation to publish its decisions and explain their rationale.”

Vodacom is the South African market leader with 35 million connections at the end of Q3 2014. It is also a stakeholder in numerous African operators in countries as diverse as the DRC, Lesotho, Mozambique and Tanzania. It has confirmed that it is unaware of any plans for a sale, while Vodafone has given no comment.

 

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