Nexus to take minister to court

Johannesburg, 17 Sept 2004

The future of the second national operator (SNO) has once again been thrown into doubt, following the news that Nexus Connexion is to proceed with its court action against communications minister Ivy Matsepe-Casaburri.

Earlier this year, Nexus filed an application seeking a judicial review of the process that saw a 25% combined shareholding in the SNO awarded to two foreign bidders, namely CommuniTel and Two Consortium.

Lawyers for the 19% empowerment shareholder filed the papers for the renewed action last night, which name Matsepe-Casaburri as first respondent, followed by Two Consortium, CommuniTel, Transtel, Eskom Enterprises and finally the Independent Communications Authority of SA.

So far Nexus has refused to comment on the SNO procedure and has indicated it will not do so today.

Transtel CEO Karl Socikwa says Nexus did not attend the meeting of the SNO interim board soon after the 26 August announcement, as it had indicated then that it could prejudice any pending legal actions.

"They said they welcomed the 26 August announcement, but were advised by their lawyers not to attend any board meetings," he says.

"It has been refreshing to see the minister stick to her guns and award the licence; despite the forthcoming legal actions, she has pressed ahead."

According to CommuniTel`s Mike van den Bergh, it has already proved difficult for the SNO to work on a structured business plan and shareholders agreement with 26% of the shares still to be allocated.

"With Nexus now seeking to renew its litigation, this will be a further headache for the SNO. It is disappointing that Nexus is seeking legal redress, rather than attempting to find solutions to the problems," says Van den Bergh.

Ant Brooks of the Internet Service Providers` Association believes it could be a long time, possibly years, before we see an SNO if Nexus persists with its legal action.

"Basically, the court action means that those members of the SNO who would like to begin work on the business plan and shareholders agreement could be held up for an indefinite period of time."