South Africa round-up: Vodacom completes ZAR1bn upgrade; Telkom’s CTO outlines LTE deployment challenges; BCX, Telkom deal awaiting regulatory approval; Vox Telecom said to be courted by three bidders

24 Oct 2014

South African telecoms operator Vodacom has completed a ZAR1 billion (USD91.2 million) investment aimed at increasing the speed, capacity and range of its networks in the Western Cape, Business Tech writes. The upgrade programme, which commenced back in October 2012, saw the telco increase the number of 3G and 4G Long Term Evolution (LTE) base stations while replacing outdated technology, while also expanding fibre-optic infrastructure that connects these base stations. Steven Barnwell, managing executive for Vodacom’s operations in the western region, said: ‘Fibre provides significant increases in capacity and speed. We are targeting download speeds of up to 65Mbps.’ Vodacom expanded its network in rural areas by adding 30 3G sites in Klawer, Sutherland, Hopefield and Barrydale, Three Sisters and Robben Island, while 2G EDGE technology was rolled out for first time in isolated places such as Lekkersing and Eksteenfontein in the Richtersveld area.

Speaking at the Broadband World Forum, Alphonzo Samuels, CTO of Telkom South Africa, outlined the challenges in providing high speed broadband access in the country. The availability of ‘high demand’ 800MHz spectrum, which is set to be freed up following South Africa’s switch-over from analogue to digital television, was described as ‘absolutely critical’ for the company’s deployment plans. The executive said: ‘I don’t have to tell any of you the advantages of [deploying LTE] in these low frequency bands. In South Africa the reality is that we haven’t done the digital terrestrial television migration, and so we are probably about two to two and a half years away from when 800MHz will become a reality’. In the meanwhile, Telkom is looking to deploy LTE-Advanced as a way of providing fixed wireless access. ‘We’ve got access to a very large chunk of 2.3GHz spectrum, and we are looking at fixed wireless in terms of LTE-Advanced,’ the CTO added. As reported by CommsUpdate in September, the operator plans to introduce the technology in December this year, extending its coverage to a total of 50 suburbs in Greater Johannesburg, Western Cape, Tshwane and KwaZulu-Natal (KZN) by March 2015.

JSE-listed IT solutions firm Business Connexion (BCX) said the Namibian Competition Commission and Tanzania’s Fair Competition Commission had unconditionally approved the ZAR2.7 billion acquisitive offer from South Africa’s biggest fixed line operator, Telkom. Ventures Africa reports that the telco is currently awaiting approval from several other competition authorities and the deal is still on track. These authorities include the Competition Commission of South Africa, the Competition Authority of Botswana, the Common Market for Eastern and Southern Africa (COMESA) Commission and the Independent Communications Authority of South Africa (ICASA). ‘Upon receipt of the above approvals, final approval will be sought from the Takeover Regulations Panel (TRP) and the Johannesburg Stock Exchange (JSE),’ BCX said. Earlier this year, Telkom proposed to pay BCX shareholders ZAR6.60 a share to acquire 100% of BCX in a transaction understood to be very critical to the fixed line operator. Shareholders representing 80% of BCX’s equity have voted in favour of the deal.

Reunert, Altron, and Seacom are some of the companies which are rumoured to be interested in buying Vox Telecom, My Broadband reports. In June 2014, Vox Telecom invited local and international companies to look into acquiring the telecoms operator. This process has progressed well, and according to Vox Telecom CEO Jacques du Toit the search for a potential buyer is 60% complete. Du Toit said that he expects the deal to be concluded before the end of the year, and noted that the interested parties include a mix of private equity players and international companies. Industry speculation suggests that Reunert and Altron are two of the front runners in the race to acquire Vox Telecom.