Vodacom's acquisition of Neotel to exclude spectrum

09 December 2015 |


South Africa’s Vodacom will no longer acquire Neotel’s spectrum after facing opposition from its rival operators.

The announcement follows the operator’s request to the country’s Competition Tribunal to postpone a tribunal hearing as it was exploring a revised transaction structure into the planned deal. In May 2014 Vodacom reached an agreement to acquire Neotel for approximately R7 billion ($500 million).

Under the new agreement, Vodacom will acquire Neotel’s fixed-line assets, excluding its mobile spectrum and electronic communications network licences. Neotel will also offer roaming rights to mobile network operators in South Africa. 

“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,” said the company.

Vodacom’s rivals have argued that it should not be allowed to acquire additional spectrum, expressing concerns that the deal may hinder competition.  Vodacom is the country’s largest mobile operator with around 30 million subscribers. 

The Competition Tribunal is set to consider the restructured transaction at a pre-hearing on December 10, according to Vodacom.