Chris Spillane
VODACOM, the African unit of Vodafone, has been granted provisional approval by South Africa’s Competition Commission to acquire Internet provider Neotel for R7 billion.
The deal has been recommended on condition that the Johannesburg-based mobile-phone company does not cut Neotel jobs and invests R10bn in the company within five years, the regulator said yesterday. Vodacom won’t be able to access Neotel’s spectrum for two years, the Competition Commission said.
The acquisition, which has already been approved by the country’s communications regulator, will now go before the competition tribunal for a final decision. Competitors including MTN, Africa’s biggest wireless operator, and Cell C have previously said they oppose the purchase because they say Vodacom would become too dominant.
Vodacom, 65 percent owned by Newbury, England-based Vodafone, agreed to buy Neotel from Tata Communications of India in May 2014. The deal would enable Vodacom to extend Internet services for small-to-medium sized businesses. –
Bloomberg