JSE-listed Vodacom has offered the plethora of small investors who own less than 500 shares in the group to sell their shares at a premium cost of R56.61 (US$7.3) per share.
The move would affect Vodacom’s 86,000 shareholders, known as ‘odd-lot holders’,…
JSE-listed Vodacom has offered the plethora of small investors who own less than 500 shares in the group to sell their shares at a premium cost of R56.61 (US$7.3) per share.
The move would affect Vodacom’s 86,000 shareholders, known as ‘odd-lot holders’, who represent 89.9% of the group’s total number of shareholders but together own just 0.58% of the company’s stock, or 8,572 million shares.
Assuming the maximum number of shares is repurchased, the financial cost should top R500m (US$65m) in addition to R2.9m (US$274,000) for transaction expenses, Vodacom says in a note on Sharenet.
The move will help Vodacom cut the “substantial” administrative costs incurred from dealing with so many small shareholders, while investors get a chance to sell their shares at a premium and without having to incur brokerage fees, Vodacom said in a statement.
“Minority shareholders who find it difficult and expensive to sell their odd-lot holdings can now do so at a premium price with no brokerage fees,” the group, which is majority owned by Vodafone, added.
Rand Merchant Bank has been mandated as transaction sponsor.
The offer price represents a 5% premium on Vodacom’s average traded price on the JSE between January 25 and February 5 2010.
Shareholders will meet on March 4 to vote on the planned offer.
