Vodacom will no longer acquire Neotel’s spectrum. Instead, the mobile operator has agreed that Neotel will offer a “roaming agreement” to all the mobile network operators.
The surprise development comes after Vodacom and Neotel asked the Competition Tribunal late last month to postpone public hearings into their R7bn deal so that they could restructure the deal. They did not say at the time what prompted the renewed talks.
The deal was set to face intense opposition from rival operators, which have argued that giving Vodacom access to Neotel’s radio frequency spectrum would give the country’s largest mobile operator an unfair advantage.
The Competition Commission had proposed that Vodacom only be allowed to use Neotel’s spectrum in two years’ time, but rivals warned that this condition wasn’t sufficient.
It now appears that Vodacom felt it would not have been able to get the transaction past the Competition Tribunal and has abandoned its plan to acquire Neotel’s spectrum assets.
“Shareholders are advised that agreement has been reached on a modified transaction in terms of which Vodacom South Africa will acquire, inter alia, the majority of Neotel’s assets related to its fixed-line business as a going concern, excluding, inter alia, Neotel’s licences,” Vodacom said in a statement to shareholders.
These include its spectrum, network and services licences. “Contemporaneously, Neotel will offer a roaming arrangement to all the mobile network operators, including Vodacom South Africa,” it said.
“Accordingly, Vodacom South Africa and Neotel have submitted to the Competition Tribunal the signed transaction documentation in respect of the restructured transaction. The Competition Tribunal will consider the restructured transaction at a pre-hearing set down for 10 December 2015. Shareholders will be advised accordingly of the outcome.”
Vodacom did not reveal how the R7bn offer price for Neotel has changed as a result of the latest developments. — © 2015 NewsCentral Media
