Zweli Mokgata

Zweli Mokgata

A group of MTN employees are unhappy about the allocation of the R3,2billion derived from the unbundling of the group's BEE share scheme.

Last week a long-serving MTN employee told Business Times that Alpine Trust, the company managing the Newshelf 664 structure, had reduced the amount originally allocated to employees without explaining its process.

The employee produced a 2002 letter that showed a provisional share allocation of about 40000 MTN shares - worth R3,8million at Friday's share price.

Employees were each given a participation ratio, whereby they would receive a certain portion of the Newshelf scheme.

Between 2002 and now, that portion has not changed, nor have there been any unexpected events affecting the scheme.

But, in the most recent letter, the employee was allocated a greatly reduced number of about 7000 MTN shares - worth R672000 at Friday's share price.

This meant that each beneficiary would receive shares that were 80percent lower than what was originally promised.

Newshelf (Pty) Ltd was established in 2002 and held by the Alpine Trust to acquire 18,7percent of MTN's ordinary shares over a six-year period.

In 2007 some of these shares were sold to the Public Investment Corporation, leaving Newshelf with a 13,1percent or R23,4billion shareholding in MTN.

Late last year, MTN announced that Newshelf would be unbundled, with an initial payment of R3,2billion, or 1,8percent of MTN Group, in a special dividend.

Approximately 3200 staff members, including chief executive Phuthuma Nhleko and chief operating officer Sifiso Ndabengwa, are waiting to receive their payout in the form of cash and shares.

According to the employee, the Alpine Trust has been less than forthcoming about the allocations.

Paul Jenkins of the Alpine Trust, said that more than 90percent of the beneficiaries were happy.