MTN has ‘options’ if Vodacom-Neotel deal goes ahead

7 Mar 2014

South African telco MTN has reportedly lined up several deals if the forthcoming acquisition of Neotel by Vodafone’s African unit Vodacom includes the transfer of radio frequency spectrum. According to TechCentral, MTN South Africa CEO Zunaid Bulbulia said: ‘If the transferability of spectrum is something that becomes [permissible] in a market context, we would be in a position to capitalise on that change.’ The executive reportedly hinted that MTN has lined up ‘a number of potential deals’ that could occur if the Neotel transaction goes ahead. However, Bulbulia stopped short of revealing any further details, as the company’s discussions are subject to various confidentiality agreements.

As previously reported by TeleGeography’s CommsUpdate, in May 2013 it emerged that Neotel was a possible acquisition target for Vodacom and MTN. By early August, however, Vodacom was very much the front-runner, with the firm reported to be conducting due diligence on Neotel following the successful outcome of takeover talks. The following month, Vodacom moved one step closer to a possible takeover following the confirmation that it had entered into exclusive talks with India-based Tata Communications, which holds 61.5% stake in the South African fixed line operator. Further, in February 2014 Tata Communications was reported as being close to finalising the sale of Neotel to Vodacom for USD502 million. Rothschild is advising Vodacom on the sale, while Tata is being guided by Rand Merchant Bank.

South Africa, Liquid Telecom South Africa, MTN South Africa, Tata Communications, Vodacom Group, Vodafone Group