Vodacom. Picture: Vodacom
Vodacom. Picture: Vodacom

VODACOM said a court ruling preventing it from taking control of licenses owned by Neotel won’t have an impact on its acquisition of the internet provider.

The decision by the North Gauteng High Court on Friday comes two months after Vodacom agreed to amend the terms of the proposed R7bn deal to exclude the permits, which are for spectrum and electronic-communications network services. The Vodafone unit will instead buy fixed-line assets and Neotel will offer a roaming arrangement to all mobile-network operators.

"The proposed modified transaction announced on December 8 2015 excluded Neotel’s spectrum and licenses, therefore today’s judgment has no bearing at all on the modified transaction," Vodacom spokesman Byron Kennedy said.

Vodacom agreed to buy Neotel from Tata Communications of India in May 2014 to increase its Internet offering amid tougher regulation and pricing in the mobile phone market. The deal became mired in lengthy competition inquiries, while competitors including Telkom SA and MTN appealed against the tie-up, which they said would give Vodacom a dominant position in the high-speed internet market.

Friday’s court decision was in response to an appeal by MTN, Telkom and mobile-phone company Cell C against a ruling by the Independent Communications Authority of South Africa to approve the transfer of control of licenses.

"Telkom welcomes the decision and believes that it was taken in the best interests of sustainability in the industry," spokeswoman Jacqui O’Sullivan said.

Vodacom shares declined 0.5% to R152.05 rand at the close.

Bloomberg