Vodacom takeover delayed by union

20 Apr 2009

According to the Financial Times, Vodafone’s plan to raise its stake in Vodacom has met an unexpected delay as the Communications Workers Union has announced its intentions to block any further sale of shares through the high court. The union is concerned that the UK-based group will use the global economic crisis as an excuse to cut jobs. Vodafone currently holds a 50% stake in Vodacom, with the other half held by incumbent fixed line operator Telkom South Africa. Telkom has announced that it will oppose the union’s court application.

As reported by CommsUpdate on 10 October 2008, the South African government has approved plans for Vodafone to buy a 15% stake in Vodacom belonging to Telkom in a deal worth ZAR22.5 billion (USD2.53 billion). Telkom’s remaining 35% stake is due to be distributed through the Johannesburg Stock Exchange. The deal with Vodafone is due to be finalised on 8 May 2009, with the subsequent listing of Telkom’s shares to take place on 18 May.