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Tribunal seeks confidential info in Vodacom, Maziv merger probe

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 05 Feb 2024
Vumatel and DFA are now known as Maziv.
Vumatel and DFA are now known as Maziv.

The Competition Tribunal has asked fibre operator Frogfoot and integrated ICT infrastructure provider Vox to provide confidential documents related to the proposed merger between Maziv and Vodacom.

In a statement, the Tribunal says it has “ordered Frogfoot Networks and Vox Telecommunications respectively, subject to a confidentiality regime, to provide Vodacom and Business Venture Investments (BVI) with access to information claimed as confidential which they supplied to the Competition Commission during its investigation into the proposed Vodacom and BVI merger".

Frogfoot and Vox are subsidiaries of newly-created holding company Vivica, while BVI (Maziv) is the parent company of fibre firms Dark Fibre Africa and Vumatel.

The Tribunal's order comes after the Competition Commission in August recommended the prohibiting of the proposed move by Vodacom merge with Maziv.

According to the competition watchdog, the proposed deal will likely to substantially prevent or lessen competition in several markets and that the conditions offered do not fully address the resultant harm to competition.

Under the deal, Vodacom is looking to acquire a 30% stake in the newly-created Maziv, with an option to increase the stake by 10%.

Maziv was created by Remgro-owned Community Investment Ventures Holdings (CIVH) after it folded Vumatel and DFA into one giant fibre infrastructure company.

CIVH last year told ITWeb that it is pinning its hopes on the Competition Tribunal giving the R10 billion deal between its fibre business unit Maziv and Vodacom the green light.

Smaller internet service providers have since expressed concerns that the proposed merge will elbow them out of the market.

The Tribunal notes that its order means that only the external legal representatives and independent economic experts (independent advisors) of the merger parties will receive access to relevant documents – subject to them providing appropriate, signed confidentiality undertakings.

In August 2023, it says, the Commission, which investigates proposed large merger transactions and refers such to the Tribunal for adjudication, recommended to the tribunal that the proposed merger should be prohibited.

During its investigation into the merger, it adds, the Commission received submissions from various third parties including Frogfoot and Vox.

According to the watchdog, Vodacom and BVI last week Wednesday applied to the Tribunal for access to all submissions, documents and data provided to the commission by Frogfoot and Vox during the merger investigation.

Frogfoot and Vox opposed the applications.

“In terms of the Tribunal’s orders, issued today, both Frogfoot and Vox must provide Vodacom and BVI’s independent advisors with all the information contained in, referred to or relied upon in the Commission’s merger report, which they had claimed as confidential, barring the information contained in one paragraph of the commission’s report relating to Vox and a letter submitted by Vox to the commission,” the watchdog says.

The Tribunal’s orders further set out a limited access regime relating to any other information claimed as confidential by Vox and Frogfoot and that does not fall within the abovementioned category.