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Tata Comm has entered into an agreement with South African state-owned enterprises, Eskom and Transnet to acquire their 30% stake for an undisclosed amount.
Tata Communication has an existing shareholding of 26% in the South African company which will increase to 56% along with Tata Africa Holdings, through this acquisition. Tata Africa Holdings is the investment arm of the Tata Group of companies in South Africa with operations in 8 countries in Africa. The agreement is subject to fulfilment of conditions which could take upto six months. The other shareholders of Neotel include Nexus, Communitel and Two Telecom Consortium. Post becoming Tata Communications, the company had announced its equity joint venture agreement with a value added services telecommunications company in China for network services and is looking for similar tie-ups in Asia and the Middle East to boost growth. The company had recently announced network expansion in Africa through an arrangement with Neotel, South Africa's first converged communication network operator. The tie-up enabled Tata Communication to offer its full global suite of products including solutions for voice and data connectivity, managed security services, among others. According to research reports, by 2010 South African and Middle Eastern countries will comprise almost 16% of the total global telecom market, only to be preceded by the emerging markets of China and India. |
Source: Business Standard