Vodafone ‘open’ to government stake in Vodacom

·26 Mar 2015

Vodafone says it is open to talks with the South African government regarding a proposed sale of it’s stake in Vodacom.

The government is reportedly looking to sell its 13.9% stake in Vodacom to fund ailing power utility, Eskom.

Reuters reported that Vodacom’s parent company has not yet held talks with the government; however, Vodafone chief executive officer, Vittorio Colao, said: “I personally haven’t got any discussion on that topic.”

“We are happy where we are. We are happy with the current situation. Having said that we would be open to discussions.”

Vodafone holds approximately 65% in Vodacom.

Vodacom has come under some pressure in it’s home market in recent months. In February, the group reported a 3.8% decline in active South African subscribers in a quarterly update for the period ended December 2014, along with a 3.1% decline in revenue for its South African unit to R15.99 billion.

Service revenue in SA declined 5.8% due to MTRs in April 2014 and by increased competition and weaker consumer spending, the group said.

Active customers in South Africa slipped to 31.379 million at the end of December 2014, from 32.613 million at the end of September.

Vodacom’s scope of movement is limited to Sub-Saharan Africa due to an agreement with Vodafone.

Vodacom has networks in Tanzania, the Democratic Republic of Congo, Mozambique, and Lesotho.

Colao told Reuters that Africa presented the group with few and expensive opportunities.

“The good assets in Africa, often the owners have a disproportionate idea of their value and therefore they don’t sell in the end. Or there are assets for sale but they are not good companies,” he said.

Vodafone has a presence in Egypt, Ghana, Kenya and Uganda.