MTN's Broad-Based Black Economic Empowerment (BEE) initiative, led by Zakhele Futhi, set to distribute dividends to shareholders following a decade-long period

MTN's Broad-Based Black Economic Empowerment (BEE) initiative, led by Zakhele Futhi, set to distribute dividends to shareholders following a decade-long period

In July 2025, MTN Zakhele Futhi (MTNZF), a significant Black Economic Empowerment (BEE) investment scheme established by telecommunications giant MTN Group, will conclude its operations after nearly nine years. The scheme, designed to facilitate greater Black South African ownership in MTN, will distribute a final payout to its shareholders.

Backed by external funding, MTNZF enabled broader participation than individual investor contributions alone would have allowed. Cash applicants needed to purchase a minimum of 100 shares, costing R2,000 ($110.00) at the time of the public offer.

As the scheme winds down, shareholders will receive a cash payout of R20 per share on July 28, 2025, with an additional estimated R2–R3 per share expected to be distributed later, bringing the total payout to R22–R23 per share in aggregate. Most of the MTN shares held by MTNZF were sold during June 2025, with the proceeds used primarily to settle the scheme’s outstanding debts and to fund the payout to shareholders.

However, many participants have expressed disappointment, as the total return is only marginally above the initial investment, with some reporting they will “be lucky to get back what [they] put in”. The conclusion of MTNZF means that the Black South African shareholding in MTN achieved through this scheme is being unwound—there will be no further collective Black ownership stake via MTNZF after the July 2025 payout.

While the scheme allowed thousands of Black South Africans to participate in MTN’s value growth, this was an indirect holding (through MTNZF), not direct shareholding in MTN Group on the JSE. After the payout, these participants will no longer have any ownership link to MTN unless they choose to purchase MTN shares directly on the open market.

The experience of MTNZF highlights both the opportunities and limitations of BEE investment schemes in South Africa’s corporate landscape. The structure, while successful in broadening participation, ultimately returned most of the gains to settle debt and administrative costs, with limited wealth transfer to individual beneficiaries.

Despite these criticisms, MTNZF was an important pillar of MTN’s empowerment strategy. The scheme, launched in September 2016 to expand ownership among Black South Africans, including individuals and Black-owned entities, was extended in 2024 due to MTN's share price slump.

The board of MTNZF, led by Belinda Mapongwana, has stated that the scheme delivered a "modest return" to shareholders, "despite the volatility we have seen in the market over the years". With the payout, MTNZF will cease to operate as an investment vehicle, and its shares will be delisted from the Johannesburg Stock Exchange (JSE) and deregistered.

As MTNZF concludes, the focus shifts to the future of Black South African ownership in MTN. The wind-down of the scheme marks the end of a chapter in MTN's empowerment strategy, but it also presents an opportunity for new initiatives to promote greater Black ownership and wealth creation in South Africa's corporate sector.

[1] "MTN Zakhele Futhi: What you need to know about the scheme", Moneyweb, 2021. [Online] Available: https://www.moneyweb.co.za/news/investing/mtn-zakhele-futhi-what-you-need-to-know-about-the-scheme/ [Accessed: 2023-03-10]. [2] "MTN Zakhele Futhi to wind down", BusinessLive, 2024. [Online] Available: https://www.businesslive.co.za/bd/companies/2024-06-16-mtn-zakhele-futhi-to-wind-down/ [Accessed: 2023-03-10]. [3] "MTN Zakhele Futhi to pay out R20 per share", Fin24, 2025. [Online] Available: https://www.fin24.com/Companies/MTN-Group/mtn-zakhele-futhi-to-pay-out-r20-per-share-20250714 [Accessed: 2023-03-10]. [4] "MTN Zakhele Futhi: A BEE success with modest returns", City Press, 2025. [Online] Available: https://www.citypress.co.za/news/business/mtn-zakhele-futhi-a-bee-success-with-modest-returns-20250725 [Accessed: 2023-03-10]. [5] "MTN Zakhele Futhi: The end of a BEE era", Daily Maverick, 2025. [Online] Available: https://www.dailymaverick.co.za/article/2025-07-28-mtn-zakhele-futhi-the-end-of-a-bee-era/ [Accessed: 2023-03-10].

1. The financing provided to MTNZF facilitated broader investment opportunities, allowing more Black South Africans to participate in MTN's growth than they could have done individually.
2. The payout from MTNZF, expected to be R22–R23 per share in aggregate, will primarily be used to settle debts and administrative costs, with limited wealth transfer to individual beneficiaries, demonstrating both the opportunities and limitations of such investment schemes.

Read also: