Telecommunications operator Rain has enjoyed a surge in demand for wireless broadband in the past year thanks to the lockdown and work-from-home measures. It now plans to bid for more spectrum.
Shareholder ARC Investments disclosed on Tuesday that Rain has “continued to surpass expectations in terms of performance and has managed to sustain its high level of customer growth throughout the reporting period”. There was strong demand for both its 4G and 5G services, it said.
The company is now working to resolve longstanding issues around poor customer service, with ARC Investments saying Rain has made progress in “addressing customer queries and complaints”. It described the growth in demand in the past year as “unprecedented”, but didn’t disclose subscriber numbers.
It said Rain will “fully participate” in the upcoming spectrum auction, although it remains unclear when the auction will take place given legal wrangling over the process
To participate in the auction, Rain will be conducting a “modest capital raise” from shareholders — it didn’t provide a quantum. This capital raise is already in progress, it added.
“The company’s (ARC Investments’) share in the value of the investment in Rain increased from R3.1-billion at 30 June 2020 to R3.3-billion at 30 June 2021 as a result of R56-million additional investment and a fair value gain of R147-million over the year.”
ARC Investments (the listed entity) is majority owned (51.1%) by African Rainbow Capital, which in turn is 100% owned by Ubuntu-Botho Investments, a broad-based empowerment company that has as its key asset a 13.1% interest in financial services group Sanlam.