MTN raises concern over Vodacom-Neotel deal

 ·14 Nov 2014
Neotel Vodacom

MTN has contacted communications regulator Icasa and the Competition Commission to express its concerns about a R7 billion merger deal between rival mobile operator, Vodacom, and fixed line player, Neotel.

Bloomberg reported that MTN passed on its concerns relating to spectrum, citing MTN regulatory affairs manager, Graham de Vries.

“MTN can confirm that it has raised certain concerns with the Competition Commission and Icasa regarding the proposed transaction, MTN will not comment further on this matter,” the mobile operator said in a statement.

Neotel and Vodacom confirmed at the end of September 2013, that they had entered into exclusive discussions regarding a potential acquisition of 100% of the shares of Neotel by Vodacom SA.

The combined entity would be able to use the radio spectrum currently assigned to Neotel more effectively, the two companies said.

“This spectrum will enable Vodacom to accelerate the roll-out of LTE (4G) services, providing high speed, high quality wireless connectivity to a greater proportion of the South African population,” Vodacom said.

Back in March, MTN questioned the transferability of spectrum between the two companies.

“It’s not acceptable as far as we understand,” said Sifiso Dabengwa, group chief executive and president of MTN, speaking at the company’s results presentation at the time.

“What is the rule or law that must be followed,” Dabengwa asked, adding: “For us to get in the way to block it is not the right way to do it. “

He said, however, that there should be a law around the transfer of spectrum.

In May, Cell C said it would oppose Vodacom’s proposed acquisition of Neotel upon submission to the Competition Commission.

“We oppose any deal that is likely to lessen competition in the market and it is our view that entrenching the dominance of an already dominant player will not be in the interest of the industry, the consumer, or the wider South African economy,” said Cell C CEO, Jose Dos Santos.

More on Vodacom and Neotel

MTN wades into Vodacom Neotel deal

Vodacom-Neotel details “weeks away”

Neotel spectrum belongs to the state

Cell C will oppose Vodacom Neotel deal

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