Cell C opposes Vodacom-Neotel deal

07 January 2015 |


South African mobile carrier Cell C is set to oppose Vodacom’s planned acquisition of Neotel at an Icasa hearing next week.

According to a report by Bloomberg, Cell C believes the deal will be threatening to its business and the local market.

Vodacom, which is 65% owned by UK’s Vodafone, agreed to buy Neotel from India’s Tata Communications in May to expand its network of high-speed fibre-optic cable for businesses and homes.

The 7 billion rand ($600 million) deal to buy the internet provider should not be approved “because of the detrimental, indeed fatal, impact that this could have on competition in the electronic communications market,” Cell C said in a statement to the Independent Communications Authority of South Africa.

The acquisition of Neotel’s customers, wireless capacity and fibre lines would position Vodacom as “a super-dominant operator” which would be hurtful to the industry, the carrier said.

In November, MTN said that the transaction should be blocked on competition grounds as it would allow Vodacom to start a high-speed 4G mobile network before other operators. Telkom has also called for Neotel’s wireless spectrum to be reallocated to other operators to prevent the deal causing a “distortion of the competitive landscape.”

A hearing on the deal is scheduled for 15 and 16 January in Johannesburg.