MTNZF payout prompts investor disappointment and questions over true empowerment

by Kelebogile Matlou

The MTN Zakhele Futhi (MTNZF) Black Economic Empowerment (BEE) investment scheme prepares to distribute its long-awaited shareholder payouts on 28 July 2025, many investors are expressing disappointment, arguing that the scheme has fallen short of its promised impact. MTNZF,
which was launched nearly nine years ago, was positioned as an opportunity for Black South Africans to participate meaningfully in the economy through ownership in one of the country’s largest telecommunications firms.

However, for many of its shareholders, the returns now being issued offer little financial relief and even less satisfaction. “I will be lucky to get back what I put in. They extended the investment term to 2027, but they now state that there is no benefit in proceeding due to market volatility. In my view, they made their
profits, and the scheme did not benefit me as an investor,” said Nomvula Buthelezi, a Human Resources Practitioner.

Investor disillusionment is rooted in years of mounting frustration. In 2019, the B-BBEE Commission flagged MTNZF for non-compliance with the spirit of the B-BBEE Act. According to the Commission, instead of empowering Black shareholders with genuine ownership and influence, the scheme placed
restrictions that undermined the principles of inclusive economic transformation.

While MTNZF indicated its willingness to cooperate with the Commission, shareholders remained dissatisfied. One investor, who preferred to remain anonymous, shared her experience: “I invested R20,000 (R20 a share) in 2016, for many of us, it was the first time we had done something like buying
shares as black women earning middle-income salaries.

Hard-earned savings, but now, almost 9 years of lock-in, with little to show. Luvo Grey, the Secretary General of advocacy group Progressive Blacks in ICT (PBICT), told TechCabal that while the scheme’s goals were noble, its structure failed to deliver competitive value. “The scheme’s empowerment
goals were commendable, but the low liquidity, high volatility, and underperformance relative to the market raise important questions about how we structure future B-BBEE investment vehicles. Ownership must come with real, competitive value creation,” he said.

The challenges facing MTNZF are not isolated. Similar BEE schemes from companies like Vodacom, Telkom, and Cell C have also struggled to deliver meaningful financial gains to their investors. Critics argue that these models create the illusion of transformation while maintaining the status quo.
“Broad-based ownership is vital, but it must also be genuinely rewarding if we are to drive long-term participation in the equity economy,” Grey said. He emphasized the need for greater transparency, better exit options, and stronger alignment between investor risks and returns in future empowerment schemes.

For MTNZF shareholders who wish to cash out, the process is now underway. Certificated shareholders will receive their returns directly into their bank accounts, while those holding dematerialized shares will receive payouts through their Central Securities Depository Participant or broker. The first payment of R20.00 per share will be made on 28 July 2025, followed by a second distribution of approximately R2.00–R3.00 per share. Shareholders are urged to update their contact and banking information through the MTNZF Shareholder Services centre by phone, WhatsApp, or email.

Although shares may still technically be traded, MTNZF clarified: “While MTNZF shares may still technically be traded, they reflect only the remaining residual MTN ordinary shares to be sold and cash to be distributed after paying or providing for costs and taxes. As such, shareholders are advised to
exercise caution when considering any sale.” As the final payments approach, the legacy of MTNZF stands as a reminder that true empowerment must go beyond compliance, it must provide real, measurable value to the communities it seeks to uplift.