Prepare for a Maziv fight

Remgro and Vodacom have decided to lodge a notice of appeal with the Competition Appeal Court following recent news that the Tribunal blocked their proposed deal.

In a notice to shareholders on Tuesday, Remgro and Vodacom announced their plan to appeal the blocking when they receive the Competition Tribunal’s reasons for the prohibition.

This deal centres around Community Investment Ventures Holdings (CIVH), one of Remgro’s key investments. The company is active in the telecommunications and information technology sectors.

Its operating companies are Dark Fibre Africa (DFA) and Vumatel, which construct and own fibre-optic networks.

Following an internal restructuring in 2023, DFA and Vumatel are held under Maziv, a newly formed wholly-owned subsidiary of CIVH, majority-owned by Remgro.

Vodacom planned to acquire up to 40% of Maziv through assets of R4.2 billion and cash of at least R6 billion.

However, this plan was stopped in its tracks when the Competition Tribunal blocked the deal, citing anti-competitive concerns.

At the end of October this year, the Competition Tribunal issued an order prohibiting Vodacom’s investment in Vumatel and DFA-owner Maziv.

The Tribunal’s decision to prohibit the merger followed hearings that lasted 26 days, from 20 May to 27 September 2024. 

Following this decision, Vodacom CEO Shameel Joosub said he was “deeply surprised and disappointed”.

“South Africa desperately needs additional significant investment, especially in digital infrastructure in lower-income areas,” he said.

“Our investment of up to R14 billion would have changed millions of lives and created thousands of jobs.”

Maziv said that it was disappointed by the outcome but that it respects the Tribunal’s process.

“We will await the reasons for the prohibition to consider our options and remain committed to driving innovation and economic growth through the power of connectivity,” it said.

The Competition Tribunal has yet to provide detailed reasons for prohibiting the transaction.

However, today the companies announced that they plan to file an appeal when these reasons are received.

“Shareholders are advised that the transaction parties have decided to lodge a notice of appeal with the Competition Appeal Court that will be supplemented upon receipt of the Competition Tribunal’s reasons for the prohibition,” the companies said.

In addition, Vodacom announced that the transaction parties remain in discussions concerning the transaction terms. 

“Should agreement not be reached, the transaction may be terminated,” the company said.