[b]Nigeria’s Glo targets South Africa’s Vodacom[/b]
By Efem Nkanga, 09.01.2008
Monday, September 1, 2008

Nigeria’s Second National Carrier, Glob-acom – reputed as Africa’s fastest growing telecommunications network – has expressed interest in Telkom’s assets in Vodacom, Southern Africa’s leading telecommunications network.

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Sources in Johannesburg, South Africa, said if Globacom’s expression of interest succeeds, it will lead to a 100 per cent merger between Globacom and Vodacom, thereby creating the continent’s largest telecommunications company.

“If the alliance is consummated, it will enable both Glo and Vodacom to pull resources together and build a pan African telecommunications giant that will be the biggest and the best,” an industry analyst told THISDAY.

Sources said Globacom is set to battle it out with UK’s Vodafone for Telkom’s shares in Vodacom. Vodafone is currently a part-owner of Vodacom.

Incidentally, Globacom’s vision since it launched its services five years ago is “to build the biggest and best telecommunications network in Africa”.

Joe Fizelle of Mowana Investment, Johannesburg, said he was optimistic that Globacom’s offer would be considered because “it presents value and growth potential to Telkom shareholders”.

The deal would see Globacom merge with Telkom’s asset in Vodacom in a new listed entity to be dubbed “Vodaglo”, with both Glo and Vodacom being equal partners.

Fizelle expressed hope that the South African government, with a 39 per cent stake in Telkom, would find the Nigerian offer more attractive than the idea of retaining a minority interest in Vodacom and seeing it become British owned.

Globacom’s expression of interest in Telkom’s assets in Vodacom is already generating tremendous excitement in the continent as it is seen as Africa’s indigenous solution to the continent’s huge telecoms challenges, industry analysts said.

Globacom has very strong footprints in the West African sub region, while Vodacom has robust footprints in the Southern African region.

The West African telecoms giant, which has over 20 million subscribers in Nigeria, instantly became the bride of the industry when it launched its operations in 2003 with its revolutionary and pocket friendly products and services.

Earlier in the year, it inaugurated its network in Benin Republic and shortly after won the licence to operate in Ghana.

Globacom is also on the verge of sealing operating licences in two other West African countries within the next one month.

Regarded as Nigeria’s most innovative telecommunications brand, Globacom is also building a submarine optic fibre cable from Lagos in Nigeria through 16 African countries to Bude in the UK and New York in USA.

The submarine cable, christened in the telecommunication industry as “Glo 1”, is right now off the coast of Senegal and will be due for inauguration soon.

Vodacom provides GSM service to more than 23 million customers in South Africa, Tanzania, the Democratic Republic of Congo, Lesotho and Mozambique.

Industry experts in South Africa believe the new development has better prospects in store for both operators as it will also foster a stronger bond between Nigerian and South African entrepreneurs.

Before now, there had been no multi-billion dollar business relationship between Nigerian entrepreneurs and their South African counterparts at this scale.

“This move is the next biggest thing to really drive home the need for investment cooperation between Nigeria and South Africa.

It represents true expression of collaboration between the two countries,” a South African economist told THISDAY.


http://odili.net/news/source/2008/sep/1/211.html

This report reads like a press release from Globacom. They can't be serious about getting into a "partnership" with Telkom and besides, why would the new entity be called VodaGlo when the "voda" in Vodacom denotes its partnership with the UK's Vodafone?

Whoever concocted this plan was surely clutching at straws, its highly unlikely that Telkom would sell it's 50% share in Vodacom to Glo and Vodafone would definitely block any such moves.