South Africa’s antitrust tribunal has blocked Vodacom Group Ltd.’s 13.2 billion-rand ($745 million) acquisition of a stake in Remgro Ltd.’s fiber businesses.
The Competition Commission, the country’s antitrust regulator, initially cast doubt on the deal last year by recommending that the Competition Tribunal reject the transaction, Bloomberg reported.
In response to the tribunal’s decision, Vodacom stated on Tuesday that it would review the detailed reasons for the prohibition before exploring available options, including a possible appeal to the Competition Appeal Court.
Remgro, in a separate statement, noted that it is also evaluating “all alternatives” available in response to the tribunal’s decision.
“South Africa desperately needs additional significant investment, especially in digital infrastructure in lower-income areas. Our investment of up to 14 billion rand would have changed millions of lives and created thousands of jobs,” Vodacom Chief Executive Officer Shameel Joosub said.
Vodacom’s proposed acquisition included a plan to inject 10 billion rand into expanding fibre access in low-income areas, aiming to create 10,000 jobs, the company stated.
Following the tribunal’s decision, Vodacom shares fell 1.1% in Johannesburg, bringing its valuation to 232 billion rand, while Remgro, partly owned by billionaire Johann Rupert, dropped by 5.9%, marking its steepest decline since March.
Vodacom had proposed to buy 30% of Maziv — a wholly owned unit of Remgro’s Community Investment Ventures Holdings Ltd. — with an option to increase this to 40%. Maziv’s key operating companies are Dark Fibre Africa and Vumatel, which build and own fiber-optic networks.
