CompCom approves Mweb buyout deal, with conditions
The Competition Commission (CompCom) has approved the proposed transaction, whereby Webafrica intends to acquire Mweb, with conditions.
Without providing the transactional details of the deal, last week Dimension Data announced it had agreed terms to dispose of its 100% interest in internet service provider (ISP) Mweb to Webafrica Networks.
In a statement today, the competition watchdog says Webafrica does not control any firm. It adds that Webafrica is a privately-held ISP providing internet services at the retail level to consumers in South Africa.
The primary target firm, Mweb, is controlled by Dimension Data, which is, in turn, controlled by Dimension Data Investments South Africa.
Mweb is a full-spectrum ISP with a nationwide consumer offering in South Africa, says the CompCom, adding Mweb’s service offering includes the provision of ADSL, fibre and fixed wireless/LTE, among others.
Its customers include residential customers and small to medium enterprise businesses.
The commission found the proposed transaction is unlikely to result in substantial prevention or lessening of competition in any relevant markets.
To address public interest concerns, the acquiring firm shall adopt and implement an employee share ownership programme and a historically-disadvantaged persons transaction.
The commission further found the proposed transaction does not raise any other public interest concerns.
Mweb is one of South Africa’s oldest ISPs, going live in 1997.
It pioneered uncapped internet access and is one of the leading ISPs in the market. Mweb works with fibre network operators and mobile network operators to provide fibre and wireless internet connectivity.
Responding to ITWeb’s questions via e-mail last week, the companies said there will be no change to employee contracts following the deal, as this is a shareholding change.
According to the firms, Mweb currently has a staff complement of about 250 employees.
“Mweb has been a valuable and important asset to the Dimension Data portfolio, and Dimension Data had numerous attractive offers to purchase the business,” said the NTT-controlled Dimension Data, noting Webafrica was the best fit for consumers.