Liquid Telecom have acquired a controlling stake in fixed and mobile service provider Neotel. Liquid Telecom currently have a joint venture with Copperbelt Energy Corporation (CEC) in Zambia. The joint venture company is called, CEC Liquid and they internet based services to the market.
Neotel’s business services include local and international leased line services, as well as a suite of voice, data (VPN), and Internet offerings delivered over its converged, next-generation network. Neotel’s majority shareholder Tata Communications has been looking to divest itself of its 68.5% share in the company. The sale of Tata’s share to Vodacom fell through due to competitive concerns from MTN and Cell C over the amount of LTE spectrum Vodacom would own through the purchase.
Liquid Telecom together with Royal Bafokeng Holdings (RBH) will purchase Tata’s 68.5% shareholding for R6.55billion. The purchase will see RBH get 30% equity in Neotel. The purchase of Neotel will open the South Africa market up to Liquid Telecom. As Nick Runick, Liquid’s CEO, said
“For the first time, African companies will be able to connect with each other in a cost-effective and reliable way, all on a single fibre network. We will also be increasing investments into Neotel to cater for rapidly accelerating mobile and enterprise traffic, enabling us to launch exciting new products and services.”
With end to end fibre we hope the sale will benefit the local market by pushing down the cost of data.