Africa’s rainbow capital (ARC) Investments has valued wireless internet operator Rain at 17.9 billion rand, up 7.9% from last year.

ARC Investments, controlled by businessman Patrice Motsepe, said on Tuesday that its 20.3% stake in Rain was worth 3.635 billion rand at the end of June 2022, up from 3.314 billion rand a year ago, giving the company a valuation. 17.906 billion rubles.

In its annual results released on Tuesday, ARC Investments said the decision to upgrade Rain was driven by several factors, including:

  • The business continues to grow in sales of 4G and 5G products; and
  • Successful acquisition of new spectrum in the March auction held by the communications regulator Icasa. The use of the additional spectrum is expected to have a positive impact on cash flow, ARC said.

The ARC Fund has invested an additional 56 million rand in Rain in the 2022 financial year. It said Rain hit its budget of 1 billion rand in profitability (earnings before interest, tax, depreciation and amortization) in the 2022 financial year that ended in February. It also broke even for the first time.

Read: Is Rain really worth as much as Telkom?

Rain hit the headlines last month when it said it planned to approach the board of larger rival Telkom about a potential merger. This follows news that Telkom and MTN Group are in merger talks. (News of these talks ignited Telkom’s share price, boosting its market capitalization to its current 25.1 billion rand.)

Rain was later forced to withdraw its bid after a takeover regulation group said it was breaking rules by publicizing its intentions to the media. After that, Rain said it was still interested in doing a deal with Telkom’s board. – © 2022 NewsCentral Media

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