The Competition Tribunal has ordered Vox Telecom and fibre subsidiary Frogfoot to hand over confidential documents to Vodacom and Maziv’s external legal advisors and economic experts.
These advisors will be required to sign confidentiality undertakings, the Tribunal stated.
Vodacom is hoping to acquire a 30% stake in Maziv, a new company established to hold the assets of Vumatel and Dark Fibre Africa (DFA).
As part of the deal, Vodacom would contribute substantial parts of its own fibre network, valued at R4.2 billion, and at least R9 billion cash.
The cash consideration includes a fixed R6 billion, with a variable portion depending on Maziv’s valuation when the deal goes through.
Vodacom’s fibre assets that would be added to Maziv’s stable include its residential, business, and tower fibre infrastructure. It excludes Vodacom’s long-distance network.
The companies have assured that Vodacom’s fibre network would immediately become open access, adopting the same wholesale model as Vumatel and DFA.
However, the Competition Commission recommended against the deal being approved.
According to Vodacom and Maziv’s application to the Tribunal, the Commission relied on data and documents provided by Vox to reach its conclusion.
They would like their legal advisors and economists to have access to the information to ensure they deal with it appropriately in their submission to the Competition Tribunal.
Vox revealed in its arguments opposing Vodacom and Maziv’s application to access the confidential data that it includes costs, prices, market shares, volumes, revenues, and pricing in the fibre-to-the-home and business fibre markets.
Vodacom and Maziv told the Tribunal on Wednesday, 31 January 2024, that Vox had previously only agreed to provide access to the information under “absurd” conditions.
They said Vox would not provide copies of the confidential information for their advisors, instead insisting that they view the documents at Vox’s premises or those of the Competition Commission.
This is impractical given the volume of data and logistically untenable as some of their advisors are in London.
However, Vox disputed the accuracy of their claims.
Vox said it offered to make the documents available at its own cost in London for the merging parties’ advisors to inspect.
Vodacom and Maziv’s representatives then came back and said they also have advisors in Stellenbosch.
Once again, Vox offered to make the documents available for inspection in Stellenbosch at its own cost.
“Every time my client accommodated the merging parties, they moved the goalposts,” Vox’s advocate stated.
The Competition Tribunal announced on Monday, 5 February 2024, that it had ruled in favour of Vodacom and Maziv.
“In terms of the Tribunal’s orders, issued today, both Frogfoot and Vox must provide Vodacom and [Maziv’s] independent advisors with all the information contained in, referred to or relied upon in the Commission’s merger report, which they had claimed as confidential,” it stated.
This excludes one paragraph of the Commission’s report relating to Vox and a letter submitted by Vox to the Commission.
“The Tribunal’s orders further set out a limited access regime relating to any other information claimed as confidential by Vox and Frogfoot and that does not fall within the above-mentioned category,” the Tribunal stated.