Vodacom plans a share buy-back programme aimed at minority shareholders who own fewer than 500 of the cellphone group’s shares. The offer is aimed at rationalising Vodacom’s large share register to reduce administrative costs.

The group is launching an “odd-lot offer” to shareholders who hold less than 100 Vodacom shares, and a specific offer to shareholders who hold from 100 to 500 shares. The offers affect less than 1% of Vodacom’s shares in issue.

The offers are at a premium to Vodacom’s share price and can be sold without incurring the usual brokerage and transaction fees, the group says. Vodacom says it has about 86 000 shareholders owning between one and 500 shares.

Odd-lot holders (those holding less than 100 shares) are being asked to either elect to sell their holding as per the terms of the offer or retain their holding. Those odd-lot holders who do not make an election will, as per JSE rules governing odd-lot offers, automatically be regarded as having accepted the offer.

Specific holders (those holding 100-500 shares) can elect to sell all their shares at the offer price. As per JSE rules, the shareholding of specific holders who do not make an election to sell their shares will remain unchanged.

A general meeting of shareholders will be held on 4 March 2010 at Vodacom’s Midrand head office to approve the necessary resolutions to implement the offers.

Vodacom is to offer R56,61/share. This was calculated using the volume weighted average traded price on the JSE over the 10 trading days commencing 25 January 2010 and ending 5 February 2010, plus a 5% premium.

“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,” says Vodacom group chief financial officer, Rob Shuter (pictured), in a statement. “Vodacom meanwhile can reduce the substantial costs associated with servicing a large number of small shareholders.”

Vodacom’s share price was trading down 0,9% on Wednesday morning. — Staff reporter, TechCentral