Vodacom-Neotel merger moves ahead

Mobile operator Vodacom and Neotel have amended the terms of a proposed R7 billion merger deal.

The Competition Tribunal of South Africa agreed late last month to indefinitely postpone a hearing regarding the merger.

Vodacom said in a market update that the company would explore a “revised transaction structure” regarding the Neotel deal.

Vodacom in its statement said the revised transaction discussions “will directly impact the extent of the approval being sought from the Competition Tribunal and the scope of the Competition Tribunal hearing”.

On Thursday, Vodacom said that the new terms will exclude Neotel’s licenses (spectrum, ECN, ECNS).

“Contemporaneously, Neotel will offer a roaming arrangement to all the mobile network operators including Vodacom South Africa,” it said.

The new financial details of the transaction were not divulged.

It said that transaction documentation relating to the restructured transaction was submitted to the Competition Tribunal on 7 December 2015.

“At a Tribunal pre-hearing held today it was agreed that, following the outcome of the roaming offer, Vodacom South Africa and Neotel will re-notify the details of the restructured transaction with the Competition Commission and that the matter will be dealt with expeditiously.

“Vodacom South Africa and Neotel have undertaken to do all things necessary to conclude the Restructured Transaction in the shortest time possible,” Vodacom said in a statement.

Since the initial offer, Neotel’s CEO Sunil Joshi has resigned –  on Monday (7 December). Chief financial officer, Steven Whiley, also stepped down from the company, after both executives were placed on special leave at the company after auditors, Deloitte, blew the whistle on R100 million in questionable payments to a company called Homix.

Neotel said that Joshi co-operated with the investigation, and the Board found ‘nothing to date’ that implicated him personally in any bribery or corruption activities.

Neotel said that Joshi left to ‘pursue his own interests’.

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Vodacom-Neotel merger moves ahead