Vumatel owner in R25-billion debt deal — South Africa’s biggest of 2023

Vumatel and DFA owner Maziv has refinanced and increased its debt package to R25 billion, in what Standard Bank says is the largest debt transaction of the year so far.

“This comes after Standard Bank was appointed as joint mandated lead arranger and bookrunner to refinance and upsize Maziv’s debt package of R25 billion, which is the largest syndication in the telecoms sector,” Standard Bank stated.

Standard Bank is Africa’s biggest lender by assets, according to Bloomberg.

In September, Remgro’s strategic investments head, Pieter Uys, told MyBroadband that Maziv’s debt stood at around R20 billion.

Uys also indicated that Maziv would be extremely cautious before taking on more debt to avoid over-leveraging its balance sheet.

Remgro, Johann Rupert’s investment holdings company, effectively owns 57.03% of Maziv through its stake in Community Investment Ventures Holdings Limited (CIVH).

Vumatel is busy rolling out fibre to South Africa’s underserved, densely-populated townships and launched a pilot project in Alexandra earlier this year.

It calls the product “Vuma Key” and hopes to offer high-speed uncapped fibre broadband at entry-level prices between R100 and R150 per month on a prepaid basis.

This complements its existing prepaid Vuma Reach product, priced from R400 per month, and its suburban Vuma Core service, which starts at around R700 per month.

“The completion of the deal opens the door to enhanced connectivity and ensures that consumer and enterprise customers increasingly benefit from fibre,” Standard Bank stated.

“It will enable deeper broadband penetration in under-serviced areas in South Africa.”

Standard Bank CIB corporate financing solutions executive Josh Gloak said they had an impressive oversubscription rate of 1.58 times across the 11 lenders.

Gloak said this indicated a growing market appetite for well-structured deals in growth sectors.

Standard Bank CIB Coverage executive for telecommunication, media and technology, Kwanele Onyango, said the deal was a major milestone and one of the most significant transactions in the telecoms sector in South Africa over the past decade.

Maziv CFO Byron Billett said the financing would help unlock South Africa’s potential.

“At Maziv, we believe in a world where everyone is connected, and this financing will support us in helping build a nation that has access to an abundance of information and knowledge that empowers its people to move forward,” said Billett.

“We believe it starts with accessible and reliable fibre solutions as connectivity is the key to unlocking SA’s potential.”

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Vumatel owner in R25-billion debt deal — South Africa’s biggest of 2023