Vodacom and Community Investment Ventures Holdings (CIVH) has agreed on amendments to Vodacom’s proposed acquisition of a 30% interest in Maziv that they hope with remedy Competition Commission concerns.
The amended proposal will now proceed to the Competition Appeal Court hearing, reserved for 22 July 2025, unopposed by the Competition Commission.
The revised transaction terms are as follows:
- Vodacom will contribute high-speed fibre to home (FTTH), fibre-to-the-business (FTTB) and business-to-business transmission access fibre network infrastructure valued at R 4,9-billion in return for new shares in Maziv; subscribe for new shares in Maziv for R 6,1-billion of cash; and acquire additional Maziv shares from CIVH sufficient to increase its shareholding to 30%. Based on Vodacom’s current expectations this leg of the transaction is estimated to be R2,5-billion.
- In anticipation of the injection of Vodacom cash and assets, Maziv intends to reset its capital structure by declaring a pre-implementation dividend of up to R4,2-billion. Should this dividend be declared, Vodacom’s cash consideration will be reduced by up to R1,3-billion.
- Vodacom’s aggregate transaction price will therefore amount to R12,2-billion (assuming Maziv declares the full pre-implementation dividend). This represents a pre-acquisition transaction equity value of R29,8-billion or R34-billion if no pre-implementation dividend is declared.
- Post 2021, Maziv acquired 49,96% of Hero Telecoms. Vodacom will subscribe for additional new shares in Maziv as consideration for its 30% of the Maziv stake in Herotel for R0,6-billion in cash. Considering Herotel, this increases the overall transaction equity valuation, post the full pre-implementation dividend, from R29,8-billion to R31,8-billion (R36-billion if no pre-implementation dividend is declared).
- Maziv is currently in the process of obtaining approval under the Competition Act, 1998 to acquire an additional 49,93% of Herotel. Should such approval be obtained, Vodacom has agreed to acquire additional shares in Maziv for its 30% proportion of the consideration based upon a fair market valuation conducted by independent banks, subject to a minimum subscription value of R0,8-billion.
- Vodacom’s option to increase its investment in Maziv (which was originally for an additional 10%) is now for up to 4,95 %. Should the option be exercised, Vodacom will own 34,95% of the issued ordinary shares in Maziv. The option exercise price will be based upon a fair market valuation conducted by independent banks following closing. The option will be subject to a minimum valuation broadly in line with the final transaction valuation.
- The extension of the transaction longstop date to 30 September 2025, with the ability to further extend to 30 November 2025.
Apart from this amendments, there has been no significant change and no significant new matter that has arisen since the first and second terms announcement were published.