The Competition Commission has approved the proposed transaction whereby subsea cable operator Seacom acquired Hymax, without conditions.
This, after in April, JSE-listed EOH announced it was selling its Network Solutions (EOH-NS) and Hymax businesses to Seacom in a R144.9 million deal.
At the time, Oliver Fortuin, group CEO of Seacom, said the acquisition forms part of the company’s ambitious growth strategy to transform the business into a converged telecommunications provider across Africa.
In a statement, the competition watchdog says Seacom is not controlled by any of its shareholders.
It notes Seacom is active at the physical infrastructure, wholesale services and retail services levels of the fibre industry.
Seacom owns a national long-haul fibre network (including owned and swapped fibre), states the commission.
At the metropolitan level, it adds, Seacom’s network spans the following metros: Johannesburg, Bloemfontein, Cape Town, Durban, Gqeberha, East London and Pretoria.
According to the Competition Commission, Seacom does not have the last mile fibre-to-the home network.
It explains its last mile fibre-to-the-business (FTTB) network is comprised of connections to buildings in Johannesburg, Cape Town as well as fibre in Kroonstad.
The primary target firm is Hymax, a South African firm, that is ultimately controlled by EOH, through EOH Mthombo.
The commission notes Hymax does not control any firms.
Hymax is active in the wholesale services and retail services levels of the fibre supply chain.
“Hymax, however, does not own a fibre network but leases dark or lit fibre services supplied by third-parties, such as Dark Fibre Africa (and others), to provide its wholesale and retail services,” the regulator says.
At the retail services level, it adds, Hymax provides fibre/wireless-based retail services directly to enterprise customers (business end-users) throughout South Africa.
To provide these ISP services, Hymax leases the FTTB infrastructure owned and operated by other last mile open-access fibre network operators. Hymax does not own the fibre infrastructure itself.
The commission found the proposed transaction is unlikely to result in a substantial prevention or lessening of competition in any relevant markets.
It further found the proposed transaction does not raise any public interest concerns.
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