DURBAN – Blue Label Telecoms on Thursday sold its 47.56 percent stake in Blue Label Mexico to its co-shareholder Grupo Bimbo for $11.5 million (R188m) as it focuses on deleveraging.
The group said the disposal was in line with its strategy to refocus its efforts on its South African distribution businesses and to deleverage the business in order to ensure a more robust and liquid balance sheet going forward.
“The proceeds from the disposal of Blue Label Mexico will be applied to settle Blue Label’s total parent guarantee obligations of $3.25m, payable to RBL Bank on behalf of Oxigen Services India as well as $5.38m as a part payment by The Prepaid Company to SPV2 against its remaining liquidity support obligations of $10m,” the group said.
Blue Label Mexico is a multi-carrier for all networks and its business model is based on long-term agreements with sales and distribution channels, independent sales organisations, service providers and mobile network operators.
“Part of its strategy is to redeploy under performing devices and to retrofit mature devices to include financial services transaction capabilities in order to assist its business partners to become more competitive and productive,” the group said.