MTN disappointed at Telkom deal block

Mobile operator MTN has expressed its disappointment at the Competition Commission’s decision to block its deal with Telkom.

“It is regrettable that the matter is not moving forward to the Competition Tribunal as the final decision making authority, as MTN firmly believes, the transaction would have enabled competition in the market and between the parties and that MTN would have been able to clearly demonstrate this before the Competition Tribunal,” MTN said in a statement late on Tuesday.

One of the largest operators in Africa, MTN trails Vodacom in South Africa and it had intended to acquire Telkom assets to expand its network in the country.

The commission found that the proposed deal was anticompetitive and “access to additional spectrum capacity by MTN will confer first mover advantages to it relating to network speed, capacity and mobile offerings”.

Particularly, the commission said that the deal would significantly harm Cell C and even Telkom Mobile, which are small players compared to Vodacom and MTN in SA.

Market share

“MTN believes that the transaction would have encouraged competition in the market and between the parties, fostered an efficient utilisation of the networks of both parties and would have been to the benefit of the sector and the country by catering to the exponential data growth,” MTN SA said.

Vodacom recently also faced hurdles in its acquisition proposal for Neotel. Despite a long delay and objections from industry, that deal received the green light.

MTN has 231 million subscribers across the Middle East and Africa, but in South Africa the operator has 28 million, behind Vodacom at 31 million.

MTN indicated that it would continue to explore consolidation in the South African market.

“MTN continues to explore other ways of efficient network consolidation and sharing as is happening in other parts of the world.”

Written by PH

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