Go get ’em
NEW VODACOM CEO Pieter Uys, who takes over from Alan Knott-Craig in October, knows the mobile operator needs to do something big in order to ensure future growth. “If we don’t set up a new strategy now we’ll be caught short. We don’t want to end up with single digit growth,” says Uys.
The brains behind Vodacom’s corporate convergence services provider Vodacom Business – and its current COO – Uys has been involved in strategic decision-making at the group for some time. He also filled in for Knott-Craig for a few months last year. Uys describes his leadership style as more conciliatory than his predecessor’s. But like Knott-Craig he believes in getting things done. He says people never leave his office without a decision having been taken there and then.
Uys will use that style to forge even closer relationships with existing shareholders and find a way for the group to expand up Africa, even in the absence of a resolution to the shareholder impasse.
“I must assume that won’t be resolved overnight. If we wait six months, we could lose out on a lot of opportunities. I have to look at the future from day one,” says Uys. He says the group’s biggest challenge is to ensure it can continue to grow over the medium to long term. “If we don’t do sizeable interventions in the next six to nine months, it will harm the business over the long term. We don’t want to wake up and realise it’s too late.”
Vodacom has tried on a number of occasions to enter the Nigerian market. Uys still wishes it had a presence there. But if need be it will look south of the equator for opportunities, even if those are small at first, Uys says. He says the model for expansion up Africa is different now to what it was five years ago. At that stage first prize was to secure a new GSM licence or buy an existing operator. Now you can consider other converged licences, enabling it to offer data and voice products (such as Telkom has in Nigeria with Multi-Links).
Uys says shareholders aren’t fighting: it’s just a case of having different strategic objectives. He’ll try to mediate.
Telkom recently renewed its cautionary announcement, saying its separate talks with British-based parent Vodafone with regard to it acquiring a portion of Telkom’s stake in Vodacom – and with a Mvelaphanda-led consortium around it making an offer for the entire issued share capital of Telkom – were ongoing. The first cautionary announcement was released on 2 June and renewed on 15 July.
Uys says if the Mvelaphanda leg of the deal went ahead it could then take much longer than if Vodafone were simply increasing its stake in Vodacom and unbundling the rest. Given the ongoing talks, Uys says he’d been surprised the decision on Vodacom’s new CEO had been taken so quickly.
The week before, a Vodafone team had been in SA meeting numerous stakeholders and the Telkom board had also met, where the final decision on his appointment must have been taken. It seems likely that the issue of Telkom’s ongoing discussions would also have been on the agenda, although Uys couldn’t confirm that.
Uys is very pleased with the progress at Vodacom Business so far. Although he conceived the idea, Uys says highly competent people it recruited for the job, such as former Telkom executive Wally Beelders, have carried through the execution.
Uys says although Vodacom Business may not make money for Vodacom over the short term, it would protect its corporate clients by being able to offer them the full suite of services.
From next year Uys acknowledges that there will be competition from competitive value-added network service licensees (Vans) who may even be able to be awarded mobile virtual network operator (MVNO) licences – piggybacking another mobile operator to offer mobile voice – and be able to offer the full suite of services. He says Vodacom could have lost corporate clients by not starting Vodacom Business. However, it had done well and could also contribute positively to the group.
As soon as he can afford to let some key people at Vodacom Business take their eye off the ball in SA that operation would also look beyond our borders.
Vodacom will soon open the public participation leg of its black economic empowerment transaction and it’s anticipated it will issue a prospectus for possible investors within weeks. That would only contain details on its SA business and exclude its operations into Africa. But other prospective investors in Vodacom – if a listing on the JSE forms part of the Vodafone deal – will also no doubt be looking out for that document.
Finweek
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