May 15, 2017 / 5:44 AM / 3 months ago

BRIEF-Vodacom to buy 34.94 pct stake in Kenya's Safaricom from Vodafone

May 15 (Reuters) - Vodacom Group Ltd

* Will acquire 34.94% indirect interest in Safaricom from Vodafone by acquiring 87.5% of issued share capital of Vodafone Kenya

* Under the deal, Vodafone will subscribe for new Vodacom Group shares

* Safaricom is owned by government of Kenya (35%), Vodafone Kenya (39.93%), public investors (25%) and Safaricom Employees (0.07%)

* Purchase consideration is sum of amount equal to subscription price for 226.8 million new Vodacom shares, which will be set off against same amount of purchase consideration, and max amount of kes393.75 million (r51 million) in cash

* Transaction offers opportunity to diversify Vodacom group's economic exposure and earning's profile in a single transaction

* Vodacom group intends to maintain its dividend policy

* Vodacom group board appointed a committee consisting of independent directors who have unanimously approved proposed transaction

* Company appointed an independent expert, Deloitte & Touché, to provide a fairness opinion on proposed transaction

* Interest in Safaricom to contribute about 15% of its earnings (before amortisation for fair value adjustment of assets on acquisition)

* As at signature date, subscription price amounts to r34.6 billion, based on Vodacom group share price on Friday 12 may 2017

* As a result of issue of new Vodacom Group shares to Vodafone, interest held by Vodafone in Vodacom Group will increase from 65.0% to 69.6%

* Vodafone will retain a 12.5% non-controlling interest in Vodafone Kenya Source text for Eikon: Further company coverage: (Bangalore.newsroom@thomsonreuters.com)

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