Vodafone awaits word from regulators

Published Mar 26, 2015

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Johannesburg - Vodafone Group PLC is running out of patience with South African regulators yet to rule on its local unit’s acquisition of internet provider Neotel Pty Ltd, which would expand its high-speed network into businesses and homes.

“We are a little bit bordering the limit here because it’s more than nine months, almost a year, and we don’t see the end of it,” Vodafone Chief Executive Officer Vittorio Colao told reporters in Johannesburg on Wednesday. “We are at the high end of the range.”

Vodacom Group Ltd, 65 percent owned by Newbury, England-based Vodafone, agreed to buy Neotel from Tata Communications Ltd of India in May for R7 billion.

Johannesburg-based competitors including MTN Group Ltd, Africa’s biggest wireless operator, and Cell C Pty Ltd oppose the purchase because they say Vodacom would become too dominant. Completion of the deal would allow Vodacom to boost its forecast for sales growth, CEO Shameel Joosub said in January.

Vodacom shares fell 1.5 percent to R131.85 as of 9.33am in Johannesburg, giving the company a market value of R196 billion.

Vodafone hasn’t held talks with the South African government about buying the state’s 13.9 percent stake in Vodacom, Colao said. The shareholding may be sold to raise funds for power plants needed to stoke economic growth, people familiar with the situation have said.

“We are good partners of the local government and we will listen to their needs and requests but I would say that I’m pretty fine with the current mix,” Colao said. “It has worked pretty well.”

Bloomberg

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