Johannesburg - Vodacom Group, the South African unit of Vodafone Group, said a revised proposal to buy Neotel has lapsed because of “regulatory complexities”.
The two companies said in December they amended the terms of Vodacom’s proposed R7-billion-rand ($446 million) purchase of the Internet service provider, with the new deal excluding permits for spectrum and electronic-communications network services. Under the revised transaction, Vodacom agreed to buy most of Neotel’s assets related to its fixed-line business, while Neotel planned to offer a roaming arrangement to all mobile-network operators including Vodacom South Africa.
That agreement has now lapsed “due to regulatory complexities in concluding the transaction as well as certain conditions not being fulfilled”, Vodacom said in a statement on Tuesday. “The parties have agreed that the proposed restructured transaction can no longer be progressed.”
While Vodacom’s acquisition of Neotel from Tata Communications of India, first announced in May 2014, was granted provisional approval by South African antitrust and communications regulators last year, it was opposed by competitors MTN, Cell C and Telkom, who argued the tie-up would give Johannesburg-based Vodacom dominance of South Africa’s high-speed Internet market.
BLOOMBERG