Vodacom BEE deal stalls

By Christelle du Toit, ITWeb senior journalist

Johannesburg, 20 Feb 2008

Vodacom's long-awaited broad-based black economic empowerment (BEE) deal has stalled, with no clarity as to the identity of the preferred bidder for the R7.5 billion deal.

According to Dot Field, Vodacom's group chief communications officer, the company will miss its self-imposed deadline for concluding the deal by next month.

"Vodacom will most likely not be able to meet this deadline due to new directives from Vodacom's shareholders and last minute changes in consortiums bidding for the deal," she said.

Field would, however, not be drawn on what the directive revision entailed, or which consortiums have changed their composition. She would also not identify the preferred bidders for the deal.

Last year, the Vodacom BEE deal was estimated to be worth R7.5 billion, with 7.5% to 10% of the company's equity to be sold. The rand value of the deal has subsequently remained unchanged, although the equity percentage up for grabs has dropped to between 5% and 7.5%.

The deal was first announced in 2006 and given a completion date of end-2007. This was then adjusted to March 2008.

Recently, it was alleged the deal had ground to a halt due to pressure exerted on the cellular operator through the political connections of one of the preferred bidders, Amandla Amoya.

The consortium is led by former national director of Public Prosecutions Bulelani Ngcuka, and former Telkom regulatory head Nkenke Kekana, who raised fears that the deal could potentially not be broad-based enough.

When asked if any pressure regarding the broad-based, or political, element of the deal was exerted on the company, Field answered: "Vodacom has adopted a transparent process from inception, and we do not intend deviating from this."

Field denied the BEE deal would set up the company to break ties with co-owner Telkom, saying "it will not fundamentally alter the current shareholding".