Altech hits back at criticism

Johannesburg, 12 Jan 2009

Allied Technologies (Altech) has blasted the MTN legal team, in response to the harsh criticism it received last week over the way in which it handled itself during the MTN-Verizon merger case.

The company's last minute withdrawal from the hearings into the merger, which were heard in half a day last week, left many involved disgruntled. This comes after Altech initially fought tooth-and-nail to be allowed to present its objections at the merger hearing.

Media reports emerged soon after, with those involved in last week's hearings accusing Altech of wasting time and resources in its fight and subsequent withdrawal from the merger proceedings. Altech CEO Craig Venter was also away at the time the reports surfaced.

In its response to these reports, Altech says: “It is unfortunate that [MTN's] senior counsel made direct attacks on Altech in its absence, knowing full well the circumstances which gave rise to Altech's withdrawal and, in this regard, Altech has reserved all of its legal rights and furthermore will be addressing the comments of MTN's senior counsel directly before the Bar Council.”

Impacting future deals

Altech initially launched its original application in November, before changing its reasons for objecting in December and, finally, withdrawing its objections altogether on Wednesday last week - a day before the tribunal hearing was set to start.

Explaining its sudden shift, Altech stated: “MTN has given a number of general undertakings in respect of the way in which it proposes to conduct the Verizon business.” Essentially, MTN has promised not to give Verizon preferential treatment in product price or sale.

Sources close to the process say the Competition Tribunal appears not to be pleased with the way in which the intervention process was handled. Furthermore, it appears likely this will have an impact on the manner in which the tribunal assesses intervention applications in the future.

At the end of last year, Altech was hailed for its heroics against the Department of Communications and communications minister Ivy Matsepe-Casaburri. It ultimately won a court case and subsequent appeals that led to a landmark ruling allowing VANS to be issued telecommunications licences.

Liberal telecoms

The company believes the negotiation and intervention process was a successful step in maintaining telecommunications market competition.

“As a result of Altech's intervention, MTN has assured the competition authorities that it will now not discriminate between VOIP and data, and will not be levying its more than 1 000% punitive surcharge for VOIP,” explains the company's statement.

Venter adds: “This is a victory for the South African cellular consumer and once again Altech has paved the way for the liberalising of South African telecommunications."

The tribunal has released a statement approving MTN's acquisition of Verizon without condition and has ordered Altech to pay MTN's and Verizon's costs in respect of the intervention application.