Vodacom leaves NITEL bid to Telkom

24 Oct 2005

South African mobile operator Vodacom has withdrawn from a joint bid with its majority owner Telkom SA for a controlling stake in Nigeria’s incumbent telco NITEL, after it emerged that the Nigerian government would not be separating the operator and its mobile subsidiary Nigerian Mobile Telecommunications (M-Tel). ‘As the Nigerian government is not considering a separation of the fixed and mobile businesses of NITEL at this stage and as Vodacom’s preference is to invest in a pure mobile player it has decided to withdraw from this process,’ the group said in a statement. Vodacom said it remained keen on an equity investment in M-Tel should the company be hived off at a later stage, and will also consider managing the business if asked to do so by Telkom.

In July the Bureau of Public Enterprises (BPE) pre-qualified six companies for the 51% stake in debt-ridden NITEL and, with it, the telco’s wholly owned mobile subsidiary M-Tel, from a list of 22 prospective investors. The BPE originally hoped to conclude a deal this month, but now says a year-end date is more likely. The companies bidding are Telkom, Chinese equipment vendor Huawei Technologies, Orascom Telecom of Egypt, pan-African operator Celtel International, South Africa-based MTN Group and the relatively unknown Newtel consortium – thought to feature a number of prominent African businessmen, including Nelson Mandela’s son-in-law Kwame Amuah.