It was announced yesterday that warring shareholders Vodacom of South Africa and its partner Congolese Wireless Network (CWN) had been unable to reach an agreement concerning their joint venture in the Democratic Republic of Congo (DRC). Now arbitration proceedings will be lodged under International Chamber of Commerce rules in Brussels. Bob Collymore, chief officer corporate affairs with Vodacom South African said, ‘We stand ready to fund further expansion and are hopeful that the arbitration process will bring a positive result.’
The disagreement between the two companies was exacerbated in recent months when Vodacom proposed a capital injection of USD484million, which would have diluted CWN’s shares in Vodacom Congo. CWN refused the injection point blank and instead, earlier this week, proposed a liquidation or sell-off to a third party of Vodacom Congo, which Vodacom in turn rejected.
Vodacom Congo, which began operations in 2002, is 51% owned by Vodacom, the African mobile network operator majority owned by Vodafone Group PLC, and the remainder by CWN.