Vodafone Group is to take control of South African operator Vodacom Group from fellow shareholder Telkom South Africa in a ZAR22.5 billion (USD2.3 billion) deal. Vodafone will also take on Vodacom debt of roughly ZAR1.55 billion. Currently the global wireless giant and national fixed line operator are 50/50 partners in South Africa’s number one mobile operator. When the UK-based company purchases a further 15% interest in Vodacom its stake to will increase to 65%.
Vodafone said the Vodacom identity will be maintained and the company will become its exclusive investment vehicle for acquisitions in sub-Saharan Africa, excluding Ghana and Kenya where Vodafone already has a presence.
Telkom said it will spin off its remaining 35% stake in the joint venture to its shareholders. It will also return half the proceeds from the sale to its investors via a special dividend. The South African government and state-owned fund manager Public Investment Corp, which together own 58% of Telkom, have agreed to support the deal and will retain a 10% stake in Vodacom for one year after its listing. The companies expect the deal to complete in the first half of 2009, subject to regulatory and Telkom shareholder approval.