In a move set to trigger competition in South Africa's fixed line sector, Vodacom – South Africa's biggest mobile phone operator, has acquired 100 percent of privately-owned fixed line operator, Neotel, for R7 billion ($676.7 million).
Vodacom says it will finance the acquisition of South Africa's second biggest fixed line operator after Telkom, by using available cash resources and existing credit facilities, Ventures Africa reported.
The deal remains dependent on the accomplishment of certain conditions, including appropriate regulatory approvals.
"Vodacom's customer base will benefit from Neotel's extensive fibre assets and enterprise capabilities which will allow Vodacom to accelerate its fixed enterprise strategy and stimulate greater competition in the South African fixed telecommunications sector," Vodacom said in a statement, commenting on the deal.
This deal will allow the merged business to offer a variety of products and an enhanced customer choice, with a likely deal completion before the end of the current financial year.