By Gareth van Zyl, Fin24
Johannesburg – South Africa’s biggest mobile network Vodacom [JSE:VOD] has walked away from its bid to acquire fixed-line telecoms company Neotel for R7bn.
Vodacom said in a statement on Tuesday morning that its proposed acquisition of the majority of Neotel’s assets has lapsed “due to regulatory complexities and certain conditions not being fulfilled”.
Subsequently, the two companies have agreed that the transaction “can no longer be progressed”.
The companies have abandoned the deal after they restructured it last year in December. As part of the restructured deal, Vodacom planned to acquire Neotel’s assets relating to its fixed-line business and not Neotel’s spectrum.
“It is disappointing that we have reached this conclusion despite all our efforts to find a way to deal with the complexities of the restructured transaction,” said Shameel Joosub, group chief executive officer of Vodacom, in a statement.
In May 2014, Vodacom launched its R7bn bid to buy Neotel.
The deal was initially planned to give the mobile network a greater fixed line network footprint and access to more radio spectrum to roll out faster broadband services.
In June last year, the Independent Communications Authority of South Africa (Icasa) and the Competition Commission approved the deal.
Subsequently, the deal went to the Competition Tribunal. However, Vodacom, at the Tribunal, then decided to drop its bid to acquire Neotel’s spectrum amid concerns raised by Cell C and MTN.
Vodacom also suffered another blow to its bid for Neotel when on Friday the North Gauteng Hight in Pretoria ordered that Icasa’s approval of the transfer of Neotel’s operating and spectrum licences to Vodacom be set aside in its entirety.
Vodacom, though, still eyes its own fixed line network.
“Our ambition to increase the rollout of fibre-based broadband services to customers remains,” said Joosub in his statement.
“We will continue to look for spectrum opportunities, as well as opportunities to accelerate our fixed- line business,” added the Vodacom CEO.
Vodacom is South Africa’s biggest mobile network with over 30 million subscribers. –Â Fin24
Source:Â http://www.fin24.com/Tech/Companies/vodacom-abandons-bid-to-buy-neotel-20160301
