We’ll do whatever it takes to block Vodacom/Neotel deal: Cell C

Mergers, Acquisitions and Financial Results

Cell C CEO Jose Dos Santos says that the operator will do whatever it takes to block Vodacom’s acquisition of Neotel.

“We will keep them in court for as long as the legal system allows it, which is two years,” Dos Santos told journalists at the company’s headquarters in Midrand on Wednesday 13 May.

“I have an entire legal team on this….we will do whatever it takes, legally,” Dos Santos said.

According to Cell C, a successful deal would “unfairly” strengthen Vodacom’s ability to compete, should the group gain control of Neotel’s spectrum.

A year ago (May 2014) Vodacom and Neotel announced that the two companies had entered into a deal that would see Vodacom acquire 100% of Neotel.

For R7 billion, Vodacom would acquire all of the issued share capital in, and shareholder loans against Neotel.

The original terms of the deal however, are sure to have changed while it sits with the telco regulators and various approval commissions.

Data traffic on Cell C’s network has increased by 44%, with data revenues increasing 59% between the first quarter of 2014 and Q1 2015, the operator said on Wednesday.

Cell C’s chief financial officer Robert Pasley said the majority of the company’s service revenue comes from prepaid subscribers.

Pasley said prepaid spend increased 17% year-on-year, while contract revenue remained flat.

Total service revenue increased 2%, despite a decline in revenue from mobile call termination rates of 18%.

Total revenue however, increased by a relatively flat 3% year-on-year.

Cell C also reported a 28% increase in subscribers between 2014 and 2015, to 20.4 million.
Source: Business Tech 13 May 2015