Remgro, an investment holding company chaired by Johann Rupert, is confident that the Competition Tribunal will approve the merger between Community Investment Ventures Holdings (CIVH) and the fibre businesses of Vodacom, South Africa’s largest mobile phone operator.
- The Competition Commission has recommended blocking the deal, which involves CIVH’s fibre units, Vumatel and Dark Fibre Africa (DFA), being folded into a new holding company called Maziv. Vodacom aims to acquire a 30% stake in Maziv, with the option to increase it to 40%.
- Remgro believes that if the Competition Tribunal approves the deal, it will benefit South African consumers and the domestic economy. The investment is expected to extend fibre infrastructure to underserved areas, create jobs, and facilitate the establishment of small to medium enterprises through a dedicated fund.
- The transaction, announced in November 2021, has already received approval from South Africa’s telecom regulator.
- The Competition Commission argues that the merger is likely to substantially lessen competition in several markets, particularly between Vodacom and Maziv in areas where both companies have deployed fibre. The commission believes that competition between fibre and 5G fixed wireless access (FWA) is beneficial for consumers, and the merger would result in the loss of such competition.
- Vodacom expressed surprise and disappointment with the commission’s recommendation, stating that the merging parties have addressed competition-related concerns through remedies and public interest commitments.
- If the merging parties are not successful in appealing the prohibition to the Competition Tribunal, there is still the option to appeal to the Competition Appeal Court (CAC), which considers appeals or reviews against tribunal decisions.