South Africa’s Competition Commission says Vodacom-Maziv deal is anti-competitive

Five months after blocking the Vodacom-Maziv merger deal, South Africa’s Competition Commission is standing firm on its decision to prevent the country’s second-largest telecom operator’s attempt to acquire a co-controlling stake in Maziv, the parent company of Vumatel and Dark Fibre Africa. The anti-competition watchdog argued that allowing Vodacom to take control would cement its dominance in mobile and give it undue influence over the fibre market, an industry over which it previously had limited control. Another complication for the telecom operator is that it does not have any precedent to make an argument. Telecom operators with fibre businesses have created their vertical businesses from scratch. A potential compromise for Vodacom could be to consider building a fibre business from scratch or reduce its stake in Maziv to a non-controlling position. That way, it could invest in fibre without wielding unchecked power over the market. The Competition Commission is holding its ground and the case will go before the appeal court in July.

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