Remgro dividends soar on the wings of Vodacom Maziv miracle

Here’s something to consider: At the end of April, Remgro shareholders will receive an interim dividend that is the highest since the pandemic. That’s on top of similarly juicy returns for FY2025 (R5.44) – which was more than double the R2.64 shareholders received in FY2024 – and the first year to include a special dividend since the Rupert empire unbundled its Implats interests in 2012.

Not bad for a former tobacco company – the special dividend before that was in 2008 when shareholders realised R119 on the VenFin/Rembrandt unbundling.

The Vodacom/Maziv merger is the catalyst of the current windfall, but the network operator hasn’t yet decided whether to exercise its top-up shareholding option, which would unlock a second direct payout to Remgro. Someone is smiling. It is not Icasa or the Competition Commission.

Because while regulators sweat under interrogation, Remgro has already engineered a masterclass in corporate restructuring that turned a crippling debt burden into a massive cash unlock.

The R19.5bn drag

A five-year view of Community Investment Ventures Holdings’ (CIVH) top-line performance shows a massive success. The revenue line rose consistently from R4.7-billion in 2021 to a massive R6.7-billion in 2025. The underlying operations (now housed under Maziv) was, supposedly, printing R4.6-billion in 2025.

Vumatel (one part of the Maziv entity) commands a 34.5% share of the fibre-to-the-home market, while Dark Fibre Africa (DFA – the other part of Maziv) dominates the commercial landscape.

To build that dominance, CIVH accumulated a debt burden that reached R19.5-billion by mid-2024.

The operational gains were being entirely wiped out by servicing that debt. In 2025, interest expenses reached R2.5-billion, pushing the company into a net loss of R203-million.

For Remgro, the majority shareholder (holding 57%), CIVH was becoming a black hole. In 2021 alone, the Rupert balance sheet had to bail the company out via rights issues totalling more than R3.7-billion just to unlock capex facilities.

Remgro needed a saviour with deep pockets. Enter Vodacom.

Parks and recreation

You know about the merger: Vodacom would acquire a 30% co-controlling stake in Maziv for R6.1-billion in cash and R4.9-billion in fibre assets.

There was just one problem. The Competition Tribunal outright blocked the deal, rightly ruling that it would substantially prevent or lessen competition – creating a fibre duopoly with Openserve.

Then came the U-turn. On the eve of the Competition Appeal Court hearing, the Competition Commission changed its tune – swayed by newly reworked conditions that made the merger much more beneficial to the South African public and came with the government’s blessing.

THE STORY SO FAR

How Vodacom and Maziv convinced everyone they had changed

July 23, 2025

During the recent parliamentary inquiry, MK’s Adil Nchabeleng reached for Daily Maverick’s framing to ask about “ulterior influence” and regulators being “hand wrestled” through backdoor channels.

That approval came about nine months after Minister of Trade, Industry and Competition Parks Tau officially participated in the proceedings to represent the “public interest”.

The message is now clear (to parliamentarians, at least) that if independent regulators push back against corporate consolidation, the precedent is now set: ministers can jump in from the top rope to turn the tables and render the CompCom and Icasa little more than speed bumps.

Remgro makes hay under cloud cover

While parliamentarians were getting to the point of asking why the deal was approved, Remgro was already cashing the cheque. The transaction was structured to extract maximum financial benefit for the holding company, while shifting the funding burden entirely onto Vodacom.

Following the successful completion of the deal, CIVH paid out R2.66-billion pre-implementation dividend directly to Remgro (hello special dividend).

Vodacom also earned the option to increase its stake in Maziv up to 34.95%. But only Remgro dilutes its indirect stake.

If Vodacom exercises this option, CIVH is legally obligated to use the cash to repurchase shares exclusively from Remgro. Other minority partners are protected, and Remgro gets a guaranteed, direct cash injection.

To secure this miraculous regulatory approval, Vodacom and Maziv promised the earth: R12-billion in capital expenditure, lower-cost broadband packages, and free 1GBps connections for clinics, schools and police stations.

But as the chairperson of the portfolio committee Shaik Imraan Subathrie (standing in for Khusela Diko who was pulling a double shift across this and the Ad Hoc committee) astutely pointed out, these promises lack specific price points, durations or escalation mechanisms.

Final impact

In the end there was no gavel fall, just more questions and a characterisation by the committee of Icasa and the CompCom as “two weak watchdogs” with a known history of struggling to enforce merger conditions.

Both entities meekly admitted to historical capacity challenges, offering vague reassurances about referring breaches to compliance committees.

Ultimately, the regulators look compromised, and the precedent for ministerial overreach has been firmly established. But over at Remgro, the balance sheet has been cleansed, the debt burden has been offloaded to Vodacom, and the R2.6-billion dividend has already cleared. DM