• BEE winners and losers

    Creating real change and real jobs requires a new ideology, says Gerhard Papenfus.

  • Governance matters

    Addressing risk well and timeously can be a source of growth, says Ian Mann.

  • Road to riches

    Taxpayers keep funding structures with big plans but who knows what efficacy, says Mandi Smallhorne.

Loading...
See More

Vodacom to buy out small guys

Feb 10 2010 14:23 Jade Menezies

Company Data

VODACOM GROUP LIMITED [JSE:VOD]

Last traded 132
Change 0
% Change 0
Cumulative volume 428225
Market cap 0

Last Updated: 31-03-2015 at 03:04. Prices are delayed by 15 minutes. Source: McGregor BFA

Related Articles

Vodacom launches odd-lot offers

All cell networks to lower rates

Cell fees deal may be imminent

Vodacom's silver lining

Cell C, Vodacom snub authorities

Vodacom snubs Icasa, lowers fees

 

Johannesburg - Vodacom [JSE:VOD] announced two share repurchase offers to minority shareholders on Wednesday.

The bids include an odd-lot offer to shareholders who own less than 100 Vodacom shares, and a specific offer to shareholders who hold between 100 and 500 shares.

These offers allow shareholders to sell stocks at a price of 5 661 cents per share - a 2% premium on Vodacom's Tuesday closing price - without incurring the usual transaction costs.

ICT analysts from Frost and Sullivan Spiwe Chireka said the buy-back offer may be a lucrative short-term proposal, as the group's immediate prospects are not favourable.

"Traditional business lines are not as lucrative as they have been in the past. We are expecting the next seven months to be really tough for them," she said. "If they can't wait for Vodacom to improve, shareholders should sell now. Portfolio manager of Cadiz Asset Management Mark Ansley said the practice is common. "You can imagine the costs of printing out glossy reports, the banking costs associated with paying out dividends and the administrative fees that go along with it. It really makes sense to just have material shareholders," he said.

These offers, which on average will have an effect on less than 1% of Vodacom's shares in issue, will reduce the administrative cost of servicing the approximately 86 000 shareholders currently owning between 1 and 500 Vodacom shares.

The price for both offers was calculated using the volume weighted average traded price on the JSE over 10 trading days, commencing January 25 2010 and ending February 5 2010, plus a 5% premium.

"We want to emphasise that as per the JSE listings rules, those persons holding less than 100 shares [odd-lot holders] must make an election to retain their shareholding if they do not wish to accept the offer," said Vodacom Group chief financial officer Rob Shuter.

If odd-lot holders do not make an election, they will automatically be regarded as having accepted the offer. However, specific holders who do not make an election to sell their shares will retain them.

A general meeting of shareholders will be held on March 4 at Vodacom's Midrand head office to approve the necessary resolutions to implement the offers.

The deadline for the offer is 12:00 on March 26.

- Fin24.com

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

SMALL BUSINESS

Johannesburg has been selected to host the Global Entrepreneurship Congress in 2017. "[The congress] will ensure that small business development remains firmly on the national agenda and the radar screen of all stakeholders, the Small Business Development minister said.
 
 

This is the most expensive burger in the world!

You won't believe how much someone was prepared to pay for this burger!

 
 

Luxury living

Exclusive food items that WILL break the bank
Top 10 most expensive homes in the world
You can permanently live on a ship and sail the world!
These are the richest people on the planet!

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

How will you manage Vodacom’s price hike for contracts?

Previous results · Suggest a vote

Loading...