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Cell C sells to Blue Label

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Blue Label Telecoms plans to acquire 35% of Cell C as part of the recapitalisation of South Africa’s third largest mobile network, writes GARETH VAN ZYL.

The move is expected to result in the current major stakeholder in Cell C, Dubai-based Oger Telecom, diluting its stake from 75% to approximately 27%, according to a report from technology news website TechCentral.

Johannesburg listed Blue Label distributes prepaid airtime, starter packs, data and electricity tokens. It also specialises in transactional offerings such as ticketing and financial services.

And Blue Label said in a market update on Thursday that it plans to “contribute R4bn to Cell C by way of a subscription for approximately 35% of Cell C’s total issued share capital following the conclusion of Cell C’s recapitalisation programme”.

The deal is expected to be effective on June 1 2016 and will reduce Cell C’s net borrowings to a maximum of R8bn, said the two companies in separate statements.

Meanwhile, Cell C further said that its management – on behalf of the company’s employees – has also submitted a binding offer to co-invest.

This means that if the restructuring deal is successful, then Cell C’s current shareholder and holding company 3C Telecommunications will hold 35% of the mobile network, management and staff 30% and Blue Label 35% of the ordinary shares in Cell C.

“Should this transaction be approved it will become one of the largest employee ownership deals in the country,” said Cell C’s chief executive officer Jose Dos Santos in a statement.

“Through this transaction, we will see more employees of our company share in the success as they continue to deliver,” said Dos Santos.

Blue Label said the transaction is still subject to agreements, the securing of funding by all parties, Cell C’s aggregate net borrowings being reduced to R8bn after the deal, and obtaining regulatory approvals.

Reasons for Blue Label investing in Cell C include the mobile network having increased its subscriber base from 9 million in 2012 to 22 million to date and Cell C’s investments in network infrastructure.

Blue Label said it has also been one of the primary distributors for Cell C’s products over the years.

“The proposed transaction provides a compelling value proposition to Blue Label, as well as to Cell C and its customers, through vertical integration affording both companies the opportunity to realise synergies in product distribution, and positioning Blue Label to benefit from the improved operational and financial performance that the combined platform would create,” said Blue Label in a statement.

The move by Blue Label also comes after Telkom last month announced that it had abandoned talks to buy Oger Telecom’s stake in Cell C.

Fin24

Source

http://www.fin24.com/Tech/Companies/blue-label-to-acquire-35-of-cell-c-20151210

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Second-hand smartphone market booms

The worldwide market for used smartphones is forecast to grow to 332.9 million units, with a market value of $67 billion, in 2023, according to IDC

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International Data Corporation (IDC) expects worldwide shipments of used smartphones, inclusive of both officially refurbished and used smartphones, to reach a total of 206.7 million units in 2019. This represents an increase of 17.6% over the 175.8 million units shipped in 2018. A new IDC forecast projects used smartphone shipments will reach 332.9 million units in 2023 with a compound annual growth rate (CAGR) of 13.6% from 2018 to 2023.

This growth can be attributed to an uptick in demand for used smartphones that offer considerable savings compared with new models. Moreover, OEMs have struggled to produce new models that strike a balance between desirable new features and a price that is seen as reasonable. Looking ahead, IDC expects the deployment of 5G networks and smartphones to impact the used market as smartphone owners begin to trade in their 4G smartphones for the promise of high-performing 5G devices.

Anthony Scarsella, research manager with IDC’s Worldwide Quarterly Mobile Phone Tracker, says: “In contrast to the recent declines in the new smartphone market, as well as the forecast for minimal growth in new shipments over the next few years, the used market for smartphones shows no signs of slowing down across all parts of the globe. Refurbished and used devices continue to provide cost-effective alternatives to both consumers and businesses that are looking to save money when purchasing a smartphone. Moreover, the ability for vendors to push more affordable refurbished devices in markets in which they normally would not have a presence is helping these players grow their brand as well as their ecosystem of apps, services, and accessories.”

Worldwide Used Smartphone Shipments (shipments in millions of units)

Region2018
Shipments
2018 Market
Share
2023
Shipments*
2023 Market
Share*
2018-2023
CAGR*
North America39.022.2%87.226.2%17.4%
Rest of World136.877.8%245.773.8%12.4%
Total175.8100.0%332.9100.0%13.6%

Source: IDC, Worldwide Used Smartphone Forecast, 2019–2023, Dec 2019.

Table Notes: Data is subject to change.
* Forecast projections.

Says Will Stofega, program director, Mobile Phones: “Although drivers such as regulatory compliance and environmental initiatives are still positively impacting the growth in the used market, the importance of cost-saving for new devices will continue to drive growth. Overall, we feel that the ability to use a previously owned device to fund the purchase of either a new or used device will play the most crucial role in the growth of the refurbished phone market. Trade-in combined with the increase in financing plans (EIP) will ultimately be the two main drivers of the refurbished phone market moving forward.”

According to IDC’s taxonomy, a refurbished smartphone is a device that has been used and disposed of at a collection point by its owner. Once the device has been examined and classified as suitable for refurbishment, it is sent off to a facility for reconditioning and is eventually sold via a secondary market channel. A refurbished smartphone is not a “hand me down” or gained as the result of a person-to-person sale or trade.

The IDC report, Worldwide Used Smartphone Forecast, 2019–2023 (Doc #US45726219), provides an overview and five-year forecast of the worldwide refurbished phone market and its expansion and growth by 2023. This study also provides a look at key players and the impact they will have on vendors, carriers, and consumers.

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Customers and ‘super apps’ will shape travel in 2020s

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Customers will take far more control of their travel experience in the 2020s, according to a 2020 Trends report released this week by Travelport, a leading technology company serving the global travel industry.

Through independent research with thousands of global travellers – including 500 in South Africa – hundreds of travel professionals and interviews with leaders of some of the world’s biggest travel brands, Travelport uncovered the major forces that will become the technology enablers of travel over the next decade. These include:

Customers in control

Several trends highlight the finding that customers are moving towards self-service options, with 61% of the travellers surveyed in South Africa preferring to hear about travel disruption via digital communications, such as push notifications on an app, mobile chatbots, or instant messaging apps, rather than speaking with a person on the phone. This is especially important when it comes to young travellers under 25, seen as the future business traveler, and managing their high expectations through technology.

Mobile takeover

With the threat of super app domination, online travel agencies must disrupt or risk being disrupted. Contextual messaging across the journey will help. Super app tech giants like WeChat give their users a one-stop shop to communicate, shop online, book travel, bank, find a date, get food delivery, and pay for anything within a single, unified smartphone app. Travel brands that want to deliver holistic mobile customer experiences need to think about how they engage travellers within these super apps as well as in their own mobile channels.

Retail accelerated

In the next year, research shows, we will see an accelerated rate of change in the way travel is retailed and purchased online. This includes wider and more complex multi-content reach, more enriched and comparable offerings, more focus on relevance than magnitude, and an increase in automation that enables customer self-service.

“How customers engage with their travel experience – for instance by interacting with digital ‘bots’ and expecting offers better personalised to their needs – is changing rapidly,” says Adrian Roodt, country manager for Southern Africa at Travelport. “We in the travel industry need to understand and keep pace with these forces to make sure we’re continuing to make the experience of buying and managing travel continually better, for everyone.”

Read the full 2020 Trends report here: 2020 Trends hub.

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