Published: Wednesday, 29 June 2016 09:17

Johannesburg, South Africa: Today, Liquid Telecom, a privately owned pan-African telecoms group, majority owned by Econet Global, announces that it has entered into an agreement to acquire South African communications network operator Neotel. The shareholders of Neotel –Tata Communications of India and minority shareholders led by Nexus Connexion (Nexus) – have agreed for Liquid Telecom to acquire Neotel for ZAR 6.55bn. Liquid Telecom is partnering with Royal Bafokeng Holdings (RBH), a South African investment group, which has committed to take a 30% equity stake in Neotel.

The transaction, which is subject to regulatory approvals, is transformative and will create the largest pan-African broadband network. Through a single access point, businesses across Africa will be able to access 40 000kms of cross-border, metro and access fibre networks. These currently span 12 countries from South Africa to Kenya, with further expansion planned.

Commenting on the transaction, Nic Rudnick, Liquid Telecom CEO, said: “We are excited about this transaction. Leveraging the strengths of Liquid Telecom, RBH and Neotel, we will offer an unprecedented fibre network with a unique set of services and international connectivity for telecom operators and enterprises across sub-Saharan Africa. 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.”

Albertinah Kekana, Royal Bafokeng Holdings CEO, said: “This transaction is part of our diversification strategy and its focus on infrastructure is in line with our objective to invest in high growth sectors. As a long term investor, we are pleased to be partnering with Liquid Telecom who has a very credible track record in rolling out fibre in challenging and diverse markets. This deal represents our long-term investment approach and our commitment to the African growth story.”

Speaking on behalf of Tata Communications, Neotel’s majority shareholder, Vinod Kumar, MD and CEO, said: “Liquid Telecom is the right partner for the next phase of Neotel’s evolution. Convergence of technologies and services will be the key driver of growth across the globe and this transaction will encourage inclusion and support the growth aspirations of the African continent. We believe that Liquid Telecom will deliver on the vision of a well-connected Africa, which will augur well for the South African telecom industry and Neotel’s customers.”
Nexus, Neotel’s minority shareholder, also welcomed the transaction.

Speaking on behalf of Nexus, Kennedy Memani, said: “We welcome this transaction with Liquid Telecom and RBH. It will see the sale of Neotel to new shareholders who have the vision, expertise and funding to continue to grow the company and to allow it to reach its full potential in South Africa and across the African Continent. We are confident that customers and employees will benefit from the transaction and from the resulting stability and business expansion.”
The transaction is subject to approval by South African regulatory authorities and is expected to be completed later this year.
Liquid Telecom was advised by The Standard Bank of South Africa Limited (lead advisor, mandated lead arranger and global coordinator) and UBS.

Advisors:
Lead Financial Advisor, Mandated Lead Arranger and Global Coordinator to Liquid Telecom
The Standard Bank of South Africa Limited
Financial Advisor to Liquid Telecom
UBS
Attorneys to Liquid Telecom
Cliffe Dekker Hofmeyr
Attorneys to RBH
Allen & Overy
Communications Advisors to Liquid Telecom and RBH
Brunswick South Africa

Notes to Editors:
About Liquid Telecom - https://www.liquidtelecom.com/>
Founded in 2004, with close on more than 1000 employees today, Liquid Telecom is a subsidiary of the privately held and diversified telecommunications group Econet. Liquid Africa is the leading independent data, voice and Internet provider operating across Eastern Central and Southern Africa. It supplies fibre optic, satellite and international carrier services to Africa’s largest mobile network operators, Internet service providers and businesses of all sizes. It also provides payment solutions to financial institutions and retailers, as well as data storage and communication solutions to businesses worldwide.

Liquid Telecom’s cross-border fibre backbone network currently stretches 40,000km across Botswana, the DRC, Kenya, Rwanda, South Africa, Tanzania, Uganda, Zambia and Zimbabwe, with further expansion planned into new markets. It also owns an independent data centre in East Africa and a high technology support centre based in London. Liquid Africa provides international connectivity and Internet Protocol (IP) transit, wholesale metro network connectivity, as well as fibre-to-the-home and fibre-to-the- business (FTTH and FTTB) connectivity. Liquid Africa’s chairman is Strive Masiyiwa and Nic Rudnick is the CEO.

About Econet - http://www.econetwireless.co.za/welcome
Econet is a diversified telecommunications group with operations and investments in Africa, Europe, South America, and the East Asian Pacific Rim. It offers products and services in the core areas of mobile and fixed telephony services, broadband, satellite, optical fibre, and mobile payments. Strive Masiyiwa is the founder and Chairman of Econet, as well as of Liquid Telecom. He was recognised by Fortune Magazine’s annual “World’s 50 Greatest Leaders” in 2013 at 35 on the list.