Liquid Telecom acquires South African fixed telecoms provider Neotel

African telecoms carrier and Econet Wireless Group subsidiary Liquid Telecom has acquired a controlling stake in Neotel, the South African fixed telecoms operator.

This comes after Tata Communications, the majority shareholder of Neotel (it holds 68,5%) entered into an agreement to dispose of its stake for 6.55 billion Rand (US $431,549 million).

According to reports, Liquid Telecom is partnering with a South African empowerment investment group called Royal Bafokeng Holdings (RBH). RBH has committed to take a 30% stake in Neotel.

Following a lapsed deal between Tata Communications and Vodacom South Africa for the Neotel sale, Liquid Telecom was shortlisted as one of the suitors along with subsea cable operator Seacom.

The Liquid Telecom/Neotel deal is still expected to meet regulatory approval and is expected to create the largest pan-African broadband network and B2B telecoms provider.

While opening up Neotel clients to Liquid Telecom’s 24,000km fibre network, the acquisition also gives Liquid Telecom a wider presence in the South African market.