Cell C’s ownership mystery

Cell C’s exact shareholder composition remains a mystery despite multiple attempts by MyBroadband to get a breakdown from Blue Label Telecoms.

When MyBroadband most recently asked about Cell C’s shareholders, Blue Label Telecoms co-CEO Brett Levy confirmed that they have remained the same since the mobile network’s recapitalisation at the end of 2022.

“There has been no change since the recapitalisation of 2022; it remains exactly the same,” Levy said.

“You have Gramercy, Nedbank, Lesaka, Blue Label, and the special purpose vehicles (SPVs).”

However, Blue Label never revealed the full list of shareholders following the 2022 recapitalisation, but Levy committed to providing a full breakdown. Unfortunately, this has not happened.

What is clear is that after concluding a deal to restructure and refinance Cell C, Blue Label became the mobile network’s largest shareholder.

Blue Label lent Cell C R1.03 billion to pay off debt claims from secured lenders through The Prepaid Company, which also purchased R2.4 billion in airtime from Cell C.

This led to Blue Label increasing its stake in the mobile operator from 45% to 49.5%.

Nedbank and Gramercy Funds Management, two of Cell C’s debt holders, have shares of 7.5% and 6% respectively.

Gramercy Funds Management, headquartered in Greenwich, Connecticut, is an emerging market investment manager with offices in London, Mexico City, Miami and Buenos Aires.

Lesaka Technologies, formerly Net1, saw its share in Cell C decrease from 15% to 5.1% following the recapitalisation. Lesaka is a South African financial technology company listed on the Nasdaq and Johannesburg Stock Exchange.

Cell C’s empowerment partner, CellSAf, owns 3%, and the mobile operator’s management owns a further 2%.

The remaining shareholding is made up of SPVs and at least 1.9% of shares that remain unaccounted for.

Blue Label created five SPVs, dubbed SPV1 to SPV5, as part of Cell C’s two recapitalisation transactions between 2017 and 2022.

SPV1, SP2, and SPV3 were created during Cell C’s first recapitalisation in 2017 to uplift Cell C’s debt. Each SPV took on the debt obligations of Cell C to various lenders.

In return for the SPVs taking on the debt obligations, each was allocated ordinary shares in Cell C. The SPVs did not acquire recourse against Cell C for assuming these debt obligations.

As part of the 2022 recapitalisation transaction, all Cell C shareholders, including the SPVs, were diluted, and two new SPVs — SPV4 and SPV5 — became shareholders.

Following this dilution, SPV1’s shares in Cell C reduced to 4.04%. SPV3’s shares were transferred to the funders to whom SPV3 was indebted.

SPV2, which was placed into liquidation, sold its shares in Cell C to SPV4. The Prepaid Company (TPC), a subsidiary of Blue Label, funded SPV4’s acquisition of shares.

The shares in SPV4 are held by Albanta Trading 109 Proprietary Limited, which is a subsidiary of the Believe Trust — established by Cell C for the benefit of Cell C employees.

SPV5 assumed the debt obligations of Cell C to Dark Fibre Africa (DFA) and was allocated shares in Cell C.

This left the remaining SPV shareholders as SPV1, with 4%; SPV4, with 10.5%; and SPV5, with 10%.

However, the Employee Believe Trust’s shares are held in three special purpose vehicles (SPVs) – SPV 1 (4%), SPV 4 (10.5%), and SPV 5 (10%) — as security for Blue Label claims.

The table below shows each of Cell C’s shareholders along with their stake in the company.

Shareholder	Stake
Blue Label Telecoms (TPC)	49.5%
SPV 4	10.5%
SPV 5	10%
Gramercy	7.5%
Nedbank	6%
Lesaka Technologies (Net1)	5.1%
SPV 1	4%
CellSAf	3%
Management	2.5%
Unaccounted for	1.9%

The following table is a breakdown of Blue Label’s entire economic interest in Cell C, including its SPVs, as presented in its most recent financial results.