Vodacom, South African Group, is to acquire 55 percent stake in Vodafone of Egypt for $2.73 billion.
The move is part of the telecom’s pan-Africa expansion initiative.
The shares are currently held by UK’s Vodafone Group Plc.
This comes barely six months after Vodacom, through the Global Partnership for Ethiopia — a consortium led by Kenya’s Safaricom — acquired a licence to start operations in the horn of Africa next year
Vodacom Group will fund its acquisition in Vodafone Egypt by issuing 242 million new ordinary shares priced at 135.75 South African Rands ($8.88) per share and $548 million in cash. This values the proposed transaction at about $2.73 billion.
“Acquiring a majority stake in Vodafone Egypt would cement Vodacom Group’s position as Africa’s leading techco by advancing our strategic connectivity and financial services ambitions while increasing our total population coverage on the continent to over half a billion people and more than 40 percent of Africa’s gross domestic Product (GDP),” Vodacom’s Chief Executive Shameel Joosub said in a statement.
Vodacom, which also acquired 35 percent stake in Kenya’s Safaricom from Vodafone Group in 2017, currently has operations in South Africa, Tanzania, Lesotho, Democratic Republic of Congo and Mozambique.
UK’s Vodafone Group Plc owns 60.5 percent shareholding in Vodacom as at March 2021.
“Vodafone Egypt is ideally positioned to capture growth in a burgeoning ICT market, which means the proposed acquisition provides our shareholders with an exciting revenue and profitability diversification opportunity and the potential to accelerate the group’s medium-term operating profit growth potential into double digits,” said Mr Joosub.