MTN : Results of MTNZ Futhi Offer and fulfilment of conditions

MTN 201611220025A
Results of MTNZ Futhi Offer and fulfilment of conditions

MTN Group Limited

(Incorporated in the Republic of South Africa)

(Registration number 1994/009584/06)

Share code: MTN ISIN: ZAE000042164

('MTN' or the 'Company')

RESULTS OF THE MTN ZAKHELE FUTHI PUBLIC OFFER AND THE MTN ZAKHELE FUTHI RE-
INVESTMENT OFFER

FULFILMENT OF ALL OUTSTANDING TRANSACTION CONDITIONS PRECEDENT

1. INTRODUCTION

Unless defined in this announcement or if the context dictates otherwise, capitalised terms
used in this announcement have the same meanings as given in the circular to MTN
Shareholders dated 6 September 2016 ('Circular').

In terms of the MTN Zakhele Futhi Offer, which closed at 16h00 on Friday, 28 October 2016,
an invitation was made (i) to the black public (individuals and groups) to subscribe for MTN
Zakhele Futhi Ordinary Shares; and (ii) to qualifying MTN Zakhele Shareholders to re-invest all
or a portion of their investment in MTN Zakhele into MTN Zakhele Futhi Ordinary Shares in
accordance with the terms of the MTN Zakhele Unwinding Scheme.

MTN Shareholders are hereby advised that all of the Transaction Conditions Precedent, as set
out in the Circular, and all outstanding conditions under the Finance Documents, have been
met and as a result the final implementation of the 2016 MTN BEE Transaction has
commenced, with closing expected to occur on 23 and 24 November 2016.

MTN Zakhele Futhi Ordinary Shares will be allotted and issued by MTN Zakhele Futhi to
successful applicants on Wednesday, 23 November 2016. Information will be communicated
to all applicants on or before 23 December 2016 to inform them, inter alia, of the status of
their applications, including, where applicable, the extent to which their applications were
accepted and the number of MTN Zakhele Futhi Ordinary Shares that were allocated to them.
To the extent that applications were not accepted, refunds will be paid on or before 23
December 2016.

MTN would like to thank every successful applicant for taking this opportunity to build their
future with MTN Zakhele Futhi Ordinary Shares.

2. RESULTS OF THE MTN ZAKHELE FUTHI OFFER

Since the closing of the MTN Zakhele Futhi Offer, a detailed process of reconciliation has been
undertaken to ensure that due process was followed during the finalisation of allocations of
MTN Zakhele Futhi Ordinary Shares to applicants who made valid applications.

The MTN Zakhele Futhi Public Offer raised approximately R1.094 billion from more than
81 000 applicants from across South Africa. In addition, applications were received from
11 203 qualifying MTN Zakhele Shareholders holding in aggregate 13 479 330 MTN Zakhele
Shares to re-invest the MTN Zakhele Scheme Consideration in respect of these MTN Zakhele
Shares into MTN Zakhele Futhi Ordinary Shares, equating to approximately R0.817 billion.

Applications (in aggregate) from the black public and qualifying MTN Zakhele Shareholders,
although exceeding the Minimum Equity Raise (being an amount of R1 234.1 million), were
less than the Target Equity Raise (R2 468.3 million). The cash raised by MTN Zakhele Futhi
under the MTN Zakhele Futhi Public Offer exceeded the minimum amount of cash required for
the 2016 MTN BEE Transaction to proceed (being an amount of R250 million). As set out in
paragraph 5 below, MTN has exercised the option for its nominee to subscribe for the MTN
Zakhele Futhi Underwrite Shares and will accordingly subscribe for 27 848 672 MTN Zakhele
Futhi Ordinary Shares for an aggregate consideration of R557 million.

The total number of MTN Zakhele Futhi Ordinary Shares to be issued and allotted on
23 November 2016 is 123 416 822.

3. REFUNDS

Refunds will be made in respect of all applications which were unsuccessful in accordance
with the provisions set out in the Prospectus. Refunds will be paid on or before 23 December
2016 by electronic funds transfer into each affected applicant's specified transactional bank
account. Interest will not be paid on the refunded amounts.

4. LETTERS OF ALLOCATION AND RELATED DOCUMENTS

A welcome pack containing, inter alia, a welcome letter, confirmation of share issuance, a
token share certificate and important MTN Zakhele Futhi shareholder information will be sent
to all successful applicants on or before 23 December 2016.

5. AMENDMENTS TO THE CAPITAL STRUCTURE MODEL

The MTN Board has resolved to proceed with the implementation of the 2016 MTN BEE
Transaction on the basis that MTN will (i) subscribe for MTN Zakhele Futhi Underwrite Shares
to make up the equity shortfall (i.e. the difference between the equity actually raised pursuant
to the MTN Zakhele Futhi Offer and the Target Equity Raise); and (ii) provide additional
Notional Vendor Finance to MTN Zakhele Futhi to ensure that the required 4:1 Inception Total
Share Cover Ratio is achieved.

In accordance with the Implementation Agreement, and having regard to (i) the transaction
sizing (being a target percentage holding for MTN Zakhele Futhi in MTN, following the
implementation of the 2016 MTN BEE Transaction, of 76 835 378 MTN Shares in the issued
share capital of MTN, representing approximately 4% of MTN's issued share capital on a fully
diluted basis); and (ii) the Inception Total Share Cover Ratio being below 4:1 times, the
following adjustments were made to the Capital Structure Model:

- MTN (or its nominee) will subscribe for the entire equity shortfall, being 27 848 672
MTN Zakhele Futhi Ordinary Shares, at R20.00 per share. MTN intends to warehouse
these shares for a period of time and to then on-sell them to select qualifying parties.
MTN has already received expressions of interest in this regard;

- MTN will increase the Notional Vendor Finance by issuing 2 392 833 additional MTN
Shares to MTN Zakhele Futhi at their par value of R0.0001 each on the terms and
conditions of the MTN Tranche 1 Subscription and Call Option Agreement; and

- the preference share funding was set to R2 160 857 000, comprising 2 160 857 MTN
Zakhele Futhi Pref Shares.

6. RESULTANT ISSUES AND REPURCHASES OF MTN SHARES

In accordance with the final Capital Structure Model, MTN will allot and issue a total of
76 835 378 MTN Shares of par value R0.0001 each to MTN Zakhele Futhi on the Closing Dates,
which MTN Shares are comprised of and have been calculated as follows:

- 25 721 165 MTN Tranche 1 Subscription Shares, to be issued to MTN Zakhele Futhi at
R0.0001 per MTN Share on Wednesday, 23 November 2016;

- 15 367 075 MTN Tranche 2 Subscription Shares, to be issued to MTN Zakhele Futhi at
R0.0001 per MTN Share on Wednesday, 23 November 2016;

- 29 388 316 MTN Tranche 2 Subscription Shares, to be issued to MTN Zakhele Futhi at
R128.50 per MTN Share on Wednesday, 23 November 2016; and

- 6 358 822 MTN Tranche 3 Subscription Shares, to be issued to MTN Zakhele Futhi at
R128.50 per MTN Share on Thursday, 24 November 2016.

Pursuant to the terms of the MTN Zakhele Repurchase Agreement dated 21 August 2016 and
the Existing MTN Tranche 1 Subscription and Call Option Agreement dated 12 July 2012, as
amended (each agreement as more fully described in the Circular), MTN will repurchase
30 732 593 MTN Shares at R112.65010 per MTN Share in terms of the MTN Zakhele Specific
Repurchase and 5 882 100 MTN Shares at their par value of R0.0001 per MTN Share in terms
of the MTN Zakhele NVF Specific Repurchase on Thursday, 24 November 2016.

By order of the Board of Directors of MTN Group Limited

22 November 2016

Investment bank, corporate advisor and transaction sponsor to MTN

Nedbank Corporate and Investment Banking

Legal and tax advisor to MTN, MTN Zakhele and MTN Zakhele Futhi

Webber Wentzel

Investment bank, corporate advisor, arranger and bookrunner to MTN Zakhele Futhi

Nedbank Corporate and Investment Banking

Co-funders to MTN Zakhele Futhi

Nedbank Corporate and Investment Banking

Rand Merchant Bank

Absa Bank

Legal advisor to the co-funders to MTN Zakhele Futhi

ENSafrica

Independent legal advisors to MTN Zakhele Futhi and MTN Zakhele

Prinsloo, Tindle & Andropoulos

Beja Incorporated

Corporate advisor to MTN Zakhele

Tamela

Broker to MTN

Nedgroup Securities

Date: 22/11/2016 01:22:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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