Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.

Connectivity

Vodacom strikes major fiber deal with CIVH in SA

Article Image
The Vodacom Group is buying into a fiber "InfraCo" in South Africa through a strategic stake in Community Investment Ventures Holdings (CIVH), in a deal worth about US$875 million.

CIVH owns major South African fiber players Vumatel and Dark Fibre Africa (DFA).

Vodacom said that, subject to regulatory approvals, Vodacom Group will hold a co-controlling 30% equity interest in a newly formed InfraCo entity. All the material assets currently owned by DFA and Vumatel, in addition to certain Vodacom-owned fiber assets, will be transferred into InfraCo.

Vodacom also has an option to acquire an additional 10% stake in InfraCo to push its ownership to 40%.

"Our agreement with CIVH aligns with Vodacom Group's strategy to build high quality and resilient fixed and mobile networks with and through selected strategic partnerships across the African continent. It also supports Vodacom’s purpose-driven plan to assist the government in rebuilding the economy post-Covid," said Vodacom Group CEO Shameel Joosub on Wednesday.

Vodacom will pay for the transaction through a combination of R6 billion (US$398 million) in cash and the contribution of its fiber-to-the-home (FTTH), fiber-to-the-business (FTTB) and business-to-business transmission access fiber network infrastructure to the InfraCo, at a valuation of R4.2 billion ($278 million), in return for new shares in InfraCo.

Vodacom will acquire further secondary shares from CIVH to increase its shareholding to at least 30% in the InfraCo. The secondary purchase is estimated to be approximately R3 billion ($198.6 million), which would bring the total purchase price up to R13.2 billion ($875 million).

Vodacom said the deal will enhance and scale its fixed offerings across both the consumer and business segments and leverage a shared cost model to accelerate the provision of open-access infrastructure in South Africa.

"This milestone investment will boost our ambitious fibre rollout programme across the country and assist in narrowing the digital divide by enabling affordable access to connectivity in some of the most vulnerable parts of our society. Ultimately, it will result in much needed inclusive economic growth," said CIVH Group CEO Raymond Ndlovu in a statement.

CIVH subsidiary Vumatel is South Africa's leading fiber network operator, which builds, owns and operates a high-speed FTTH network, using a wholesale open-access model that passes more than 1.2 million homes and has deployed over 31,000 kilometers of fiber infrastructure across South Africa.

In terms of the agreement, Vumatel's fiber network will be merged with Vodacom's FTTH and FTTB assets.

DFA is a leading provider of carrier-grade dark fiber, specializing in building, installing and operating a national metro fiber network spanning 13,000 kilometers and 37,000 connected circuits, and supplying a range of dark fiber and actively managed fiber products to enterprise customers.

Related posts:

*Top image source: Technology photo created by freepik - www.freepik.com.

— Paula Gilbert, Editor, Connecting Africa

Innovation hub

Story

Four agritech startups to watch in 2024

Connecting Africa has compiled a list of four agritech startups that are making a difference in the communities they serve.

Story

Paymentology looks to strengthen its African roots

Global issuer-processor Paymentology's CEO Jeff Parker spoke to Connecting Africa about the company's African roots and aspirations to work with more banks, fintechs and enterprises both on the continent and globally.

More Innovation hub

Latest video

More videos

Partner perspectives

All Partner Perspectives

Sponsored video

More videos

Industry announcements

More Industry announcements

Upcoming events

Africa Tech Festival 2024
November 11-14, 2024
Cape Town, South Africa
More Upcoming events

Africa Tech Perspectives

Story

Uber's Marjorie Saint-Lot on inclusion and sustainability in Africa

Uber's Country Manager for Ghana and Cote d'Ivoire, Marjorie Saint-Lot, shares how the ride-hailing company is approaching public-private partnerships, environmentally friendly initiatives and gender inclusion in Africa.

Story

The 100 most influential African leaders in 2023

A new report from Africa Tech Festival and Connecting Africa puts a spotlight on the top 100 African leaders in the telecoms and technology sector in 2023.

Story

Deep dive into East Africa's tech startup ecosystem

New survey reveals a lack of access to investors, reliance on international VCs and global recession trends as the biggest barriers for East African tech startups to access funds.

More Africa Tech perspectives

Guest Perspectives

Story

Omdia View: February 2024

By Omdia Analysts

Highlights in February 2024 in the Middle East and Africa included 5G launches in Senegal and 5G trials in Egypt as well as Kenya's first 5G MVNO. Airtel also launched a new wholesale connectivity business while MTN and Huawei are planning a joint Innovation Technology Lab in South Africa – that and more in this month's Omdia View.

Story

Omdia View: January 2024

By Omdia Analysts

Highlights in January 2024 in the Middle East and Africa included a $200 million fintech deal between MTN and Mastercard as well as 5G network trials by Telecom Egypt – that and more in this month's Omdia View.

More Guest Perspectives

Like us on Facebook

Newsletter Sign Up


Sign Up
Tag id test-002