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MultiChoice makes offer to BEE scheme members to exchange shares

Aug 30 2019 18:03
Lameez Omarjee, Fin24

Investors in Multichoice's Phuthuma Nathi Investments scheme can exchange up to 20% of their shares in the scheme for MultiChoice shares, according to a new offer.

Phuthuma Nathi is a broad-based black economic empowerment scheme, by which more than 90 000 black shareholders own a stake in MultiChoice South Africa.

According to a notice issued to shareholders on Friday, the broadcasting company said it intends to make an offer to shareholders in the Phuthuma Nathi scheme in exchange for up to 20% of their shares which are listed on the Equity Express Securities Exchange. In exchange, Phuthuma Nathi shareholders will receive MultiChoice shares.

MultiChoice Group in February listed on the Johannesburg Stock Exchange, as part of its unbundling from media and internet giant Naspers. In its pre-listing statement, MultiChoice had first announced its intentions related to the BEE transaction.

"The purpose of the proposed acquisition is to provide Phuthuma Nathi shareholders with an opportunity to gain exposure to the rest of MultiChoice Group's assets, while providing additional liquidity to Phuthuma Nathi shareholders through the JSE listed MultiChoice Group shares," the notice read.

MultiChoice said the transaction reinforces its commitment to socio-economic transformation in South Africa.

The proposed transaction will see an exchange of 0.97 MultiChoice shares for every one Phuthuma Nathi share. In effect MultiChoice will acquire 9 million Phuthuma Nathi 1 ordinary shares and up to 4.5 million Phuthuma Nathi 2 ordinary shares. In turn a total of 13.095 million MultiChoice ordinary shares will be issued.

This will result in MultiChoice Group increasing its stake in the South Africa unit from 75% to 80%.

The offer is available to Phuthuma Nathi shareholders who hold more than 20 shares. The offer applies between September 25, 2019 to October 28, 2019. The acquisition is effective from October 29, 2019.

*Fin24 is part of Media24, a subsidiary of Naspers.

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