VODACOM/TELKOM AND VIRGIN MOBILE LINKED WITH POSSIBLE EQUITY INVESTMENTS IN NIGERIA

Mergers, Acquisitions and Financial Results

Pan-African mobile network operator Vodacom is said to be interested in re-launching a bid to enter the Nigerian mobile market - with help from its parent company, Telkom SA - after previous efforts to secure a controlling stake in Nigerian cellco V-Mobile (formerly Econet Wireless Nigeria) ended in failure. According to Lagos-based newspaper This Day, Telkom has submitted bid documents to the Bureau of Public Enterprises (BPE) for some or all of the 51% stake in national operator Nigerian Telecommunications Limited (NITEL) currently being offered by the Federal Government, and has teamed up with Vodacom which will take control of NITEL’s mobile arm, M-Tel, if the bid is successful. Telkom’s investor relations officer Belinda Williams confirmed the company’s interest in acquiring a strategic stake in NITEL but stopped short of saying that it was looking for full control of the company, saying ‘we do not want to acquire fixed-line licences, because they come with heavy licence conditions’.

In a separate story, Richard Branson’s Virgin Mobile has been linked to Vodacom’s former target V-Mobile and is rumoured to be holding talks with its board over a possible deal to purchase an equity stake in the cellco. Although no formal decisions have been taken, people familiar with the deal say that members of the Virgin Mobile team may soon head out to Nigeria to conduct due diligence on V-Mobile. Other sources suggest that Virgin is not the only European company interested in the Nigerian company.

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