Subscriptions for MTN’s new R9.9-billion broad-based black economic empowerment (BBBEE) scheme MTN Zakhele Futhi are now open to qualifying black investors and groups.
Some 123.4-million ordinary shares in MTN Zakhele Futhi are on offer to new and existing investors at R20 a share, with a minimum R2 000 investment, from Monday until October 21.
MTN Zakhele Futhi, which succeeds the six-year-old MTN Zakhele when it unwinds on November 24, will acquire 4% equity, or around 76.8-million shares, in MTN Group at an effective 20% discount, MTN South Africa CEO Mteto Nyati told media and investors at the launch on Monday.
MTN Zakhele Futhi, which will run for a period of eight years and be listed on the JSE after three years, will, in effect, hold 62.2 MTN shares for every Zakhele Futhi share issued.
The new scheme will be opened up to new potential investors in the form of a cash investment for a minimum of 100 shares, while existing MTN Zakhele shareholders can reinvest the funds released to them following the unwinding of the 2010 scheme by having the shares – a minimum of 50 Zakhele shares – converted into Zakhele Futhi shares.
MTN Zakhele aims to settle its remaining liabilities, including taxes, costs, expenses, third-party preference share funding and the notional vendor finance from MTN, in full before distributing the residual value to shareholders.
The shareholders can also opt for a direct cash payout – an automatic function for those with less than 50 shares – or a conversion to MTN Group shares, which requires a minimum of 200 Zakhele shares.
The preceding scheme had benefited over 120 000 shareholders – 98% of whom were individual investors and 85% of whom held 500 shares or less.
The company is now preparing to embark on a nationwide roadshow starting in Gauteng on September 17 and ending in KwaZulu-Natal on October 18 to unpack MTN Zakhele Futhi and how potential investors can participate.