Johannesburg - Cell C Pty Ltd, the third-largest wireless operator in South Africa, is in talks with Huawei Technologies and ZTE Corporation about developing its high-speed network, Chief Executive Officer Jose Dos Santos said.
The phone company is in late-stage negotiations with the Chinese manufacturers about building its first commercial 4G- technology network and may complete the deal at Mobile World Congress next week, Dos Santos said in an interview Tuesday. Cell C’s fast-data strategy will focus on developing long-term evolution service for business customers, the CEO said.
“We’ve been spending the best part of eight to nine months putting this contract and our LTE strategy together,” he said at the company’s headquarters in Johannesburg.
Cell C’s survival is at risk as the country’s two larger mobile-phone operators, Vodacom Group Ltd and MTN Group Ltd, seek transactions to strengthen their dominance in Africa’s most industrialised economy, Dos Santos told lawmakers in November.
The closely held company, majority-owned by Dubai-based Oger Telecom Ltd, reduced its workforce last year and has appointed advisers to help explore options. Among the alternatives are a possible sale to domestic competitors, people familiar with the matter said a week ago.
Shareholder review
“Like any shareholder,” the owners are reviewing “the top structure of what we do and how we’re going to do it,” Dos Santos said. “That doesn’t mean they exit. When shareholders look at options, they look at options. If they do engage with certain people, which I’m not aware of, it’s just a good thing to do.”
Rena Qin, a spokeswoman for Shenzhen-based ZTE, confirmed there are negotiations under way and declined to comment further. Yi Linna, a spokeswoman for Shenzhen-based Huawei, declined to comment immediately.
Cell C, which increased customer numbers last year by 44 percent to 19.6 million subscribers, has an investment budget for 2015 totalling R2.2 billion ($191 million), according to a statement on Tuesday. The partnership with Huawei and ZTE would focus on developing infrastructure, information-technology systems and customer billing, Dos Santos said.
“What we’re going to do with LTE is provide high-speed data to certain market segments that we want to participate in,” Dos Santos said.Cell C has tested 4G service at sites in Cape Town, Durban, Johannesburg and Pretoria, according to its website.
* With assistance from Amy Thomson in London and Edmond Lococo in Beijing
Bloomberg