Local Internet service providers (ISPs) have little interest in being gobbled up by Vodacom as SA's biggest cellular network looks to boost its place in the ISP market.
Last month, Vodacom Group CEO Alan Knott-Craig said the company would look to make a significant ISP acquisition in order to "buy" its way into the space. He went on to tell Business Day the deal would "involve a company roughly the size of Dimension Data's local operations".
The statement sparked speculation that Dimension Data subsidiary Internet Solutions (IS) may be the target of Vodacom's affections.
However, a source at Dimension Data, who asked to remain unnamed, says IS is not for sale to Vodacom.
"IS is a core part of the Dimension Data group and its strategy going forward. Unless a stupid amount was offered, it would be very unlikely such a sale would even be considered. At the moment I can confirm there is nothing on the cards in that respect," explains the source.
Not a target
The local arm of international communications company Verizon is another company considered by analysts to be a likely target.
Although Verizon SA's parent refuses to comment on market speculation, Vodacom chief communications officer Dot Field quashed rumours the cellular giant had entered into an agreement with the company.
"Contrary to rumours currently circulating, Vodacom has not bought Verizon Business," she says.
No deal
Meanwhile, shares in the DataPro Group gained 44%, from R2.47 to R3.55 per share, during June. The rapid increase, says one analyst, came as investors speculated the company could provide a good match for Vodacom.
However, the group's executive chairman Tony van Marken says it will go to the market with a statement should it receive an offer in writing.
"Everyone has discussions and there are a lot of rumours circulating the market at the moment. We can't confirm or deny those rumours; however, if something firm is proposed, we are required by the JSE to notify the market. We haven't done that, which should speak for itself," he explains.
As for whether the group would consider selling, Van Marken says it would have to be a really good offer.
"We believe we have the opportunity to build something really special here. So at the end of the day, the offer would have to be really special too."
On track
Despite the three ISPs being taken off the list of prospective targets, Field says Vodacom's strategy is on track.
"We cannot comment on speculation or make forward-looking statements like that. All I can say is that our strategy is well on track," she explains.
The Internet Service Providers Association has 14 members that it considers to be large. So far IS, Verizon and DataPro have been excluded as willing sellers. Additionally, analysts have dismissed MTN Network Solutions, MWeb, Neotel and Sentech as likely candidates.
Of the remaining large players - AT&T, CMC Networks, GS Telecom, Posix Systems, Storm Telecoms, T-Systems and UniForum SA - Storm Telecoms is considered to be the favourite.
Share