Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.

Business of Tech

SA's Cell C makes inroads to slash $436M debt

Article Image
South African operator Cell C has managed to cut a slice off its debt as some secured lenders agreed to forfeit 80% of the debt owed to them as a way to help out the cash-strapped operator.

Improving its debt levels is a critical milestone in the financial restructuring and much-needed recapitalization of the mobile operator, a plan that has been on the cards for years.

Cell C said in a statement that the secured lenders, who formerly held publicly listed bonds or notes, had voted with the necessary quorum and majority in favor of the compromise cash out offer of 20c for every R1 of debt.

"This is a significant step in the overall process to deleverage Cell C's balance sheet. It shows confidence in our new business strategy and with the overall debt reduced and simplified; we are set to compete as a sustainable entity going forward," said Cell C CEO Douglas Craigie Stevenson.

This particular debt of US$184 million is just a portion of Cell C's overall debt of 7.3 billion South African rand (US$436 million) owed to secured lenders.

Renewed hope for recapitalization

Cell C's major shareholder, Blue Label Telecoms, also issued a statement saying the final stages of the Cell C recapitalization transaction are being implemented and it is expected to proceed to a final close in late July.

In August 2017, Blue Label bought a 45% stake in Cell C for R5.5 billion (US$327 million).

This was part of Cell C's first recapitalization, but the telco has faced serious financial challenges since then, and this second recapitalization has been in the works for three years to try to turn around the struggling mobile operator.

At the end of 2019, Blue Label was forced to write down the value of its entire investment in Cell C to zero.

Recently, Cell C has managed to improve its financial position with a new strategy to cut costs and offload infrastructure. For the six months to June 2021, it reported a R148 million (US$8.8 million) profit before tax, compared to a R7.6 billion ($453 million) loss in the same period in 2020.

Related posts:

* Top image is of Cell C's CEO, Douglas Craigie Stevenson. (Source: Cell C).

— Paula Gilbert, Editor, Connecting Africa

Innovation hub


Five mobility startups to watch in 2024

Connecting Africa has compiled a list of five mobility startups that are making a difference in the communities they serve.


Orange Ventures, Digital Africa promise more funding for startups

Orange Ventures and Digital Africa are teaming up to invest more in tech startups in Africa and the Middle East through Digital Africa's Fuz program and the Orange Digital Center network.

More Innovation hub

Latest video

More videos

Partner perspectives

All Partner Perspectives

Sponsored video

More videos

Follow us on X

Industry announcements

More Industry announcements

Upcoming events

Africa Tech Festival 2024
November 11-14, 2024
Cape Town, South Africa
More Upcoming events

Africa Tech Perspectives


Uber's Marjorie Saint-Lot on inclusion and sustainability in Africa

Uber's Country Manager for Ghana and Cote d'Ivoire, Marjorie Saint-Lot, shares how the ride-hailing company is approaching public-private partnerships, environmentally friendly initiatives and gender inclusion in Africa.


The 100 most influential African leaders in 2023

A new report from Africa Tech Festival and Connecting Africa puts a spotlight on the top 100 African leaders in the telecoms and technology sector in 2023.


Deep dive into East Africa's tech startup ecosystem

New survey reveals a lack of access to investors, reliance on international VCs and global recession trends as the biggest barriers for East African tech startups to access funds.

More Africa Tech perspectives

Guest Perspectives


How e-mobility could transform Africa's transport sector

By Francis Hook

ICT analyst Francis Hook delves into Africa's e-mobility sector and unpacks the challenges faced locally and the benefits the move to electric vehicles could bring to urban transport systems.


Omdia View: April 2024

By Omdia Analysts

April 2024's telecoms highlights in the Middle East and Africa included a license for Starlink in Ghana, new mobile termination rates in Ethiopia, and 6G trials in Bahrain – that and more in the latest Omdia View.

More Guest Perspectives

Like us on Facebook

Newsletter Sign Up

Sign Up
Tag id test-002