M-Cell has increased its holding stake in MTN by 4.9%, taking its total holding in the cellular provider to 77%. The deal will be settled with the issuing of 77.5 million new ordinary M-Cell shares.
In line with the agreed M-Cell strategy to consolidate MTN into the company, M-Cell acquired 25 million MTN shares in exchange for 77.5 million M-Cell shares.
M-Cell has calculated that the financial effects of the deal on the company would be negligible, saying there would be no material change in either earnings per share or net asset value of the company, had the deal been concluded at the time of its published interims in September last year.
The cautionary pertaining to negotiations between Transnet and M-Cell is suspended. Transnet owns a 30% stake in cellular network provider MTN, and was looking to swap its holdings in MTN for the issue of ordinary M-Cell shares.
MTN is now controlled by Johnnic through M-Cell. Both have seen their share prices climb lately. M-Cell closed at 3 690c, gaining 2.5% yesterday and Johnnic shares gained 4.6% to 10 460c.
There has been speculation that Johnnic and MTN, together with Transtel, will bid for the secondary fixed-line licence once Telkom`s exclusivity period expires.
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