Virgin set to take over Vmobile

2005-05-20 09:03:03
By: Bill Okonedo

http://www.businessdayonline.com/index.php?fArticleId=7299
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The duel between Virgin Mobile of the Uk and Vodacom of South Africa for controlling equity stakes in Nigeria's GSM network, Vmobile, seems tilted in favour of the former, BUSINESSDAY checks have indicated. Also, we gathered, Vmobile will announce its new equity partner anytime from now, but at the latest, following a board meeting next week.


http://www.businessdayonline.com/index.php?fArticleId=7299

Why is it that Vmobile is the talk of the day in GSM world?

Because Vmobile has not fully unleashed her potential as a GSM operator and infact, the Vmobile culture is second to non. Vmobile is all about you "The customer". Right now Vmobile has one of the best staff care program that other obile network those not have. When you see a vmobile staff, he/she is always proud about the company.

If you have money, Vmobile is a good buy

Hmm...do you honestly believe what you've just said? Everyone here in PH (my city of residence), complains about the very poor reception rate of Vmobile. About how you persistently redial until there's a connection.

Yes, their customer support could be great, but what every customer greatly needs is just not a great support personnel, but a service that is justifiably real value for his or her money, or wouldn't you agree with that?

I'm beginning to take an interest in this,I think I'll prefer virgin mobile to buy Vmobile-Richard Branson's( he is the oga of Virgin anything) companies always proves to be innovative when it comes to management and customer satisfaction

The problem with selling our companies to extremely rich and smart businessmen like Richard Branson is that, by the time he is through with the GSM market, all the competing companies which are partly owned by Nigerians (MTEL, Globacom Limited, and even MTN) would be[b] dead and buried[/b].

Seun that can only happen if our businessmen are as dumb as you're implying. Branson's entry into Nigerian market can actually invigorate it.

@ Seun:

Do you know something about him that should be shared? We need investors and that's we are getting.

I don't think that our companies would be dead as Seun said because of the entry of Branson (or presumed entry?)

Britsh Airways is not dead because of Virgin Air. Competition is beneficial to the consumers most of the time. Anyhow, Branson can only have at most 49% share in Vmobile, so technically it is still a Nigerian company.

Branson can only hav at most 49% share in Vmobile

I'm relieved to hear that. Which means he won't necessarily be controlling the company. This means he's going to have enough Nigerians on board to frustrate his decisions and oppose his bold business moves.

seun:

Branson can only hav at most 49% share in Vmobile

I'm relieved to hear that.  Which means he won't necessarily be controlling the company.  This means he's going to have enough Nigerians on board to frustrate his decisions and oppose his bold business moves.

And this is supposed to be a good thing?

Anyway, it will only take an extra 2% for him to get his way... shouldn't be too difficult for him to get.

ThisDay Online is now reporting that Vodacom is set to take over Vmobile Nigeria. Talk about a change of mind! According to them, "Barring any last minute changes or a more substantial offer from United Kingdom’s Virgin Mobile, South Africa’s Vodacom is set to win the bid for a majority stake in Nigeria’s mobile telecom operator, Vmobile Nigeria"

The reason given, though, is very weak:
"THISDAY gathered that it is the value shareholders are going to get from the Vodacom deal that has informed the sudden change of mind. A source close to the directors, however, said that 'nothing is conclusive yet'".

Source: http://thisdayonline.com/nview.php?id=18473 (username nairaland, password nairaland)

While we're on the issue of foreign investment in Nigeria, the following blog posts:
[list][li]Lagos: (Relative) Business Paradise - on AdamSmithee, and[/li][li]New Kid on the Block - by Abiola Lapite on Foreign Dispatches[/li][/list]... have noted that Nigeria, inspite of the (partly deserved) reputation for fraud and corruption, is rated better than China (and the Phillipines, Venezuela, Lebanon and Indonesia) and only slighty worse than India, Egypt and Russia in the Kurtzman Group's 'Opacity Index', which basically measures the level of corruption in a country.

A chart which summarizes the Opacity Index, including Nigeria's position in the index, is available here. You can also download the full report as opacity.pdf.

Well, it may either be good or bad, but to my view it is just another way of colonizing the Nigerian GSM world. What about our indigenous investors? Can't they take over Vmobile and forget about any foreign investors and give a better name unlike Econet, Vodacom, Vmobile? Thisnet, Thiscom, and Thismobile?

Seun:

The problem with selling our companies to extremely rich and smart businessmen like Richard Branson is that, by the time he is through with the GSM market, all the competing companies which are partly owned by Nigerians (MTEL, Globacom Limited, and even MTN) would be[b] dead and buried[/b].

Nice to see you have no confidence in the abilities of nigerians

abubakarshayau:

Well, it may either be good or bad, but to my view it is just another way of colonizing the Nigerian GSM world. What about our indigenous investors? Can't they take over Vmobile and forget about any foreign investors and give a better name unlike Econet, Vodacom, Vmobile? Thisnet, Thiscom, and Thismobile?

Its better to have a Nigeria take over the company, but if its going to be a foriegner, I guess Branson can't be too bad. Its also not a bad thing that south africans invest in nigeria. Of course you dont want them to own the place, but many countries get rich by having rich neighbors invest in them,like japan did for malaysia

Allenpowered:

I don't think that our companies would be dead as Seun said because of the entry of Branson (or presumed entry?)

Britsh Airways is not dead because of Virgin Air. Competition is beneficial to the consumers most of the time. Anyhow, Branson can only have at most 49% share in Vmobile, so technically it is still a Nigerian company.

Actual Virgin is bidding for 51%

Virgin group has antecedents of turning markets around and driving down prices, I think that is one thing we need in the telecoms industry in Nigeria. as fo Seun's fears, I think our business men have proved their worth and they can't be thrown aside by any Richard. Glo gave MTN a run for their money despite being whole owned by a Nigerian from scratch, the competition might even be healthy. Besides the market is large enough. As for M-tel, it is better privatised, and I thot Virgin was interested in buying Nitel and Mtel.

Branson's practice is to buy force prices down, drive competition or buy them then when he has a captive market. You can guess the result. He is still a capitalist animal; he is just more innovative and he seems to have patience, tenacity and almost limitless capital to cause such great discomfort to competition.

As for Nigerians, we are short sighted animals; we can't see the long term picture at all!

Someone talked of Japan and Malaysia. Thats ok, but the level of Malysian input was high and across board too - HR, Tech, the lot. We need God's Grace to survive. The race is almost ended and we don't have the tools to compete in a world like this.

It turns out that Celtel was the one that rather bought over Vmobile.