On Friday, January 24, Blue Label Telecoms is officially ready to take control of Cell C, a mobile company in South Africa, after the country’s communications regulator, Icasa, gave the green light to transfer the mobile operator’s spectrum and network licences. This is a huge step for Blue Label, which already owns 49.5% of Cell C and has been working hard to help the company get back on its feet.
The licence transfer news has been a big deal, and the market seemed to know something was coming. Blue Label’s share price recently soared to a 52-week high of R6.20 per share on Thursday, January 23 — a massive 71% jump in just one year. Investors are clearly excited about the idea of Cell C making a comeback, and they think Blue Label might be the key to making it happen.
But there’s a twist: Cell C won’t be completely handing over its licences. Icasa said that while Blue Label, through its subsidiary The Prepaid Company, will take over a controlling 53.57% stake, Cell C will still manage its licences and run its services. So, while Blue Label gets the power to steer the company’s future, Cell C will continue to operate its business.
Cell C’s new CEO, Jorge Mendes, is hopeful about the company’s recovery. He has been working on plans to help the company grow again, and this deal could be just the boost Cell C needs.
Not everyone was happy with the licence transfer at first. Cell C’s empowerment shareholder, CellSAf, raised concerns that Blue Label might be “asset stripping” — meaning taking too much value out of the company. However, Cell C made it clear that the licences will stay with them; only the ownership structure is changing.
The Competition Commission also gave its approval last year, but with some rules to make sure airtime distribution stays fair and to prevent any unfair sharing of information. Now, the last step is getting the green light from the Competition Tribunal.
This deal marks a fresh start for Cell C, and it could be a big chance for Blue Label to help the company recover and grow. With more confidence from investors and a solid plan ahead, this could shake things up in South Africa’s mobile phone world!
