Tata Communications Ltd on Tuesday said it has entered into an agreement with the South African government-owned Eskom Holdings Ltd and Transnet Ltd., to acquire their 30% stake in South Africa?s Neotel Ltd, South Africa?s first converged communications network operator. Tata Communications already owns 26% of Neotel. Other shareholders in Neotel, which is building South Africa?s second fixed-line telephone network includes Nexus, Communitel and Two Telecom Consortium, Tata Communications said in a statement to the Bombay Stock Exchange (BSE).
The value of the acquisition was not disclosed by Tata Communications. The agreement is subject to fulfilment of certain conditions, some of which have a period of upto six months to be fulfilled, it said.
After the completion of the acquisition, Tata Communications along with Tata Africa, would have an effective 56% stake in Neotel. In June this year, Tata Communications had announced the further expansion of its network reach into Africa through an arrangement with Neotel. According to earlier reports, the new multi-service Point of Presence (PoP) established in Johannesburg, South Africa, seamlessly integrates with Neotel?s next generation network and IP/MPLS infrastructure for onward national and regional connectivity. Tata Communications, erstwhile Videsh Sanchar Nigam Ltd (VSNL), is part of the diversified Tata group. Neotel, which is also managed by the Tatas, was launched in August 2006 and is a competitor to Africa?s largest telephone group, Telkom.
Last week, Tata Communications International Pte Ltd, a wholly owned subsidiary of Tata Communications, had signed an equity joint venture agreement with the shareholders of China Enterprise Communications (CEC) Limited for the acquisition of 50% equity in CEC.
