103 replies to this topic

[andi222]

Looks like the current share price is a good one as the company is repurchasing their own shares. 

[Bullhunter]

Blue Label Telecoms chairman Larry Nestadt is on a spending spree. The businessman, whose achievements include co-founding Investec Bank, has acquired millions of rand worth of shares in the company in recent weeks as its stock price continued to plumb levels last seen a decade ago.

Blue Label, whose market value has fallen precipitously since it concluded the acquisition of a 45% stake in Cell C for R5.5-billion last year, said on Tuesday that Nestadt bought nearly R1-million of its shares on 19 and 22 October. The shares were acquired through the LM Nestadt Trust at an average of just below R5/share.

This comes on top of even more significant purchases by his trust in recent weeks.

Prior to those purchases, the LM Nestadt Trust acquired R5.5-million worth of shares at an average of R6.90 apiece.On 8 October, the chairman — who serves in a nonexecutive capacity — bought R1.1-million worth of shares at an average of R5.59/share. That was followed on 9 October by another R1.1-million purchase at R5.59/share and a further R546 000 at R5.46/share on 10 October.

In his chairman’s report in Blue Label’s annual report, released earlier this month, Nestadt said he and the board were “naturally concerned about the decline of the share price, which we believe is largely attributable to uncertainty with respect to Cell C’s turnaround strategy, current debt levels and requirements for further funding”.

“These concerns will be largely negated on the proviso that Cell C delivers on its business plan,” he wrote. “In this regard, it is our intention to monitor and assist on a diligent basis and to communicate the results thereof on a more detailed basis going forward.”

Share wipeout

“We trust that our improved Cell C disclosure will build greater confidence in support of our strategy to ensure positive cash-flow generation and in turn enhance the core business of Blue Label.”

Since the beginning of the year, Blue Label has shed two-thirds of its value, apparently largely on investor concern about Cell C’s prospects. Its market capitalisation of R4.7-billion is now less than the company paid for 45% of Cell C. In the past 12 months, the share price is down 70.5%. It’s performance over three years and five years isn’t much better — falling 57.2% and 42.9% respectively. It is now trading below its listing price in 2007.

In his chairman’s report, Nestadt said the past year was defined by Blue Label’s acquisitions of the stake in Cell C as well as 100% of 3G Mobile and 60% of Airvantage. In total, the company spent more than R7.5-billion on these deals, of which R3.9 billion was funded through the issuing of 272 million new shares.

“The acquisition of Cell C was both of a defensive nature and created an opportunity for earnings growth,” he said. “The acquisition was defensive in that it protects Blue Label from possible disintermediation by the mobile network operators, and earnings enhancing in that we can assist in turning the company around through continuing capital restructure and executing their strategic objectives.”“In considering the merits of these acquisitions, the board debated whether each company met our acquisition criteria, which include strategic fit, accretiveness to earnings, defensive positioning, and new products and channels”.

He said both the 3G and Airvantage acquisitions will be earnings accretive for Blue Label. “Not only will these acquisitions assist in the growth of Cell C, but they will also benefit the core Blue Label distribution business and add first-class skills and technologies to our group.”

The acquisitions added “valuable new skills and talent to the group, and we now intend to maximise these both vertically and horizontally to extract value for the business”.

“Bedding down processes, systems and platforms in conjunction with new technologies and skill sets will be the group’s priority in the 2019 financial year.”  — © 2018 NewsCentral Media

[Lionelza1]

Market seems to be turning this one around?

[Polly]

Did some detailed homework on this one last night.

 

At R4.00 i may dip my toes into it.

[JK001]

seems like Market is turning this trend around? albeit day 1

 

Think it is just at a resistance level at this point, so up and down for a few weeks my guess.

[Lionelza1]

seems like Market is turning this trend around? albeit day 1

[Ms Jet]

Just in a straight line...more or less...but other than buying more npn have just been trying be patient re snh ...hard but have to wait

[Rex]

Rex hows your trading this week..hope all good! Obviously blue is blue at mo...

 

Hey Jet,

 

everything going up except SNH and Naspers, I don't have Blue shares at the moment, a bit risky.

 

What about yours?

[Spell Jammer]

Oh dear..

 

 

 

Strange move by key Cell C shareholder

Staff Writer30 September 20183 Comments

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A key Cell C shareholder, 3C Telecommunications, has raised eyebrows after it provided “blanket indemnity” to exiting directors.

This is according to a report in the City Press, which said the indemnity resolution was ratified by the 3C Telecommunications board last month.

After Blue Label’s recapitalisation deal of Cell C, 3C Telecommunications owned 30% of the mobile operator.

The 30% share of 3C Telecommunications is in turn held as 29.4% by the Employee Believe Trust, 45.6% by Oger Telecoms, and 25% by CellSaf.

CellSaf has been a vocal opponent of the deal, calling it “the most blatant attempt at corporate hijacking in recent history”.

The exiting directors which received indemnity from the 3C Telecommunications board were all from Oger Telecoms.

A Companies Act legal expert called the blanket indemnity “quite unusual”, especially when this indemnity was not in place when the directors joined the board.

Cell C spokesperson Candice Jones said it appears that “CellSaf, the empowerment partner of our former shareholders, Oger Telecom, are attempting to undermine the sustainability of Cell C”.

Concerns over Cell C sustainability

Blue Label, which is a 45% shareholder in Cell C following its recapitalisation deal, has been struggling with a falling share price.

S&P Global Ratings’ decision to downgrade the company’s credit rating from B- to CCC+ on liquidity concerns did not help the situation.

Since the Cell C deal was concluded, Blue Label’s share price fell from around R17.80 per share to the current R5.53 per share.

The chart below shows the Blue Label share price over the last year.

Blue Label finds concerns unjustified

In a recent interview with TechCentral, Blue Label Telecoms co-CEO Brett Levy said investors are happy with the performance of the company’s core services.

However, he admitted there are many questions regarding Cell C’s performance and uncertainty on the operator’s future prospects.

He said he struggles to understand what people compare Cell C’s performance to.

“If someone says Cell C is not doing well – not doing well against what? We expected them to do better against what?” asked Levy.

He added that they have made “a lot of headways in a lot of different places” at Cell C, and that they are “on the right track and are really doing well”.

 

[Ms Jet]

Rex hows your trading this week..hope all good! Obviously blue is blue at mo...

[JK001]

It is difficult to conceptualize and I try and put different lenses on this article.

 

1) The minority shareholding of the 'staff' company did not want BLU in as it diluted their value, the p...d off and creates lots of negative publicity.

2) The members who got the bonuses actually saved CellC from the abyss. So, maybe they deserve a great bonus, for us ordinary people the bonus may seem excessive.  Maybe members of point 1 above should be thankful otherwise they had not even a job never mind a light at the end of the tunnel.

3) As a person adverse to regulating adults, I am contradicting my own values that says there should be regulation that prohibit bonuses for a loss making company.

 

my 10c.

 

[Bullhunter]

ROB ROSE: The nerve of Cell C executives Paying R219m to just three executives of Cell C, after the cellular operator narrowly avoided hitting the wall, seems a little rich

 

FINANCIAL MAIL, 27 SEPTEMBER 2018

 

There are some distinctly unhappy staff at Cell C’s swish headquarters in Midrand who are fuming over disturbingly lavish payments made to CEO Jose dos Santos and his comrades in the executive suite.

A series of letters have been flying around in recent weeks between "representatives of 391 Cell C employees" and the board of the country’s third-largest mobile phone operator, which claims to now have 16.3-million subscribers

What sparked the exchange was Cell C’s financials for the year to December 2017, which, interestingly for a company that claims it wants to list within two years, are not on its website. Those accounts show how payments to executives vaulted more than fourfold last year — from R50.9m to R219.2m — at a time when staff say the business is slashing expenses in every other corner.

It means that of the R1.49bn spent on all 2,272 employees last year, nearly 15% went to just three people — Dos Santos; chief strategy officer Robert Pasley; and Tyrone Soondarjee, who resigned as Cell C’s FD in May.

Now, it’s certainly clear that, financially, good things happened for Cell C last year. For the year to December, a "recapitalisation" by Blue Label Telecoms (which ended up as a 45% shareholder) and Net1 UEPS (which ended up with 15%) injected R7.5bn into the company, which allowed it to reduce its net debt from an impossible R18.9bn to a merely steep R5.9bn.

Its revenue grew 7% last year to R15.7bn and it made a R267m net loss, if you strip out the one-off gains it made from that recapitalisation. So, Cell C just managed to keep its head above water.

But what has irked staff too is that Cell C’s financials show that it had set aside R357m to be paid as a "success fee" to certain executives for the recapitalisation. It doesn’t say who gets this windfall specifically, other than describing them as "key executives who were integral" to the deal. The top brass — again.

What has irked staff too is that Cell C’s financials show it set aside R357m as a ‘success fee’ to certain executives

Zwelakhe Mankazana, a director of empowerment group Cellsaf, which owns 7.5% of Cell C, isn’t happy: "If you look at Cell C’s net proceeds of this recapitalisation of R4.1bn, it seems crazy to be paying a R357m ‘success fee’ to a group of executives who’re already remunerated just for doing their jobs. And this is above the R219m paid to two or three executives."

Mankazana says that as shareholders, Cellsaf "feels defrauded" by these lavish payments made from shareholders’ funds.

The 391 staff seem equally miffed.

On August 24, they wrote to Cell C’s chair, Kuben Pillay, saying they had been told that Cell C wasn’t able to pay full bonuses "due to tight budget and financial constraints". Yet, they said, immense sums were paid to executives, which "does not speak to fairness".

A few days later, Cell C’s human resources executive, Juliet Mhango, wrote to the staff, arguing that all staff benefited from various incentive schemes. On the "success fee", Mhango said the recapitalisation "was a necessary intervention to prevent the closure of the company and the loss of every job".

And she said even though Cell C didn’t hit its targets, the board agreed a "discretionary bonus" for the lowest-paid staff.

This didn’t impress the staff. They wrote back asking why Pillay had not responded, since it was the board that made the decision. Any response from the executives "compromises the legitimacy of your response as these individuals are at the centre of the contentious issues raised", they wrote.

They added that despite what was claimed, the discretionary bonuses were "made to a select few". They also asked for Cell C’s financial statements to confirm "that the company is indeed in dire straits".

On September 6 Pillay wrote back to the staff, encouraging them to lodge a formal grievance if they wanted to, but adding that "none of the payments" was paid in a "dishonest or unauthorised manner".

Ironically, the problem seems to be that Cell C’s communication with its own staff is abysmal. In fact, its communication with anyone is shoddy, it seems. When the FM asked specific questions about its payment practices, Cell C refused to answer. Instead it provided a bland "official comment" saying absolutely nothing new.

As a company 60% owned by JSE-listed companies, you’d think Cell C could be a bit more transparent. For a company talking boldly about listing on the JSE either next year or in 2020, its shoddy level of transparency suggests it’s nowhere near ready.

Edited by Bullhunter, 27 September 2018 - 09:50 AM.

[JK001]

Someone bought 6.22 million shares at 2.45 pm @ R 5.36.


Thanks Polly I saw the edit button 'used' to add this comment - education is great!

Edited by JK001, 26 September 2018 - 06:52 PM.

[JK001]

 

First you got to be logged in.
The i think only allows you 10 minutes from time you posted to edit.
If within 10 min , you will see edit button at bottom right of your post.
If you dont see it, means time expired..sucks a bit hay

 

Thanks Polly

[Polly]

anyway - can anybody tell me how to edit a post - working with a MAC and cannot find an edit button - frustrating

 

First you got to be logged in.

The i think only allows you 10 minutes from time you posted to edit.

If within 10 min , you will see edit button at bottom right of your post.

If you dont see it, means time expired..sucks a bit hay

[JK001]

anyway - can anybody tell me how to edit a post - working with a MAC and cannot find an edit button - frustrating

[JK001]

never bought..merely converted cfd to underlying..Half the problem with these bros are gambling in cfds in own shares...Think already was a force sale a month ago...

Won;t surprise me - from what I read their mom had a hard time cause they always wanted to sell everything.

[Polly]

and still taking a knock on this conversion...eish

Edited by Polly, 26 September 2018 - 06:06 PM.

[Polly]

Between the joint CEOs and another director about R 70 million rand worth of shares on sept 7: See sens below:

 

NOTICE OF DEALINGS IN SECURITIES IN TERMS OF PARAGRAPHS 3.63 TO 3.66 OF THE
JSE LIMITED (JSE) LISTINGS REQUIREMENTS

Dealings in securities by directors of Blue Label.

In compliance with paragraph 3.63 – 3.66 of the JSE listing Requirements, the following
information, is disclosed:

Company: Blue Label Telecoms Limited
Director: Mr MS Levy
Class of securities: Ordinary shares
Date of transaction: 06 September 2018
Number of securities: 3 500 000
Price per security: R6.58
Total value: R23,030,000.00
Nature of transaction: On-market conversion of contracts for difference
Nature and extent of director’s interest: Direct beneficial
Clearance to deal: Obtained in advance in accordance with JSE Listings
Requirements

Company: Blue Label Telecoms Limited
Director: Mr BM Levy
Class of securities: Ordinary shares
Date of transaction: 06 September 2018
Number of securities: 3 500 000
Price per security: R6.58
Total value: R23,030,000.00
Nature of transaction: On-market conversion of contracts for difference
Nature and extent of director’s interest: Direct beneficial
Clearance to deal: Obtained in advance in accordance with JSE Listings
Requirements

Company: Blue Label Telecoms Limited
Director: Mr DA Suntup
Class of securities: Ordinary shares
Date of transaction: 06 September 2018
Number of securities: 3 700 000
Price per security: R6.58
Total value: R24,346,000.00
Nature of transaction: On-market conversion of contracts for difference
Nature and extent of director’s interest: Direct beneficial
Clearance to deal: Obtained in advance in accordance with JSE Listings
Requirements


The above conversion shall result in their underlying shares in Blue Label being transferred back to
them, with no impact or change in their shareholding in the company.
Sandton

07 September 2018

 

never bought..merely converted cfd to underlying..Half the problem with these bros are gambling in cfds in own shares...Think already was a force sale a month ago...

[Ms Jet]

Seems like half people think the share screwed and other half not...i think itll rise..