Vodacom ponders listing of its South African financial unit

Vodacom ponders listing of its South African financial unit

Following a flurry of investment activity recently, operator Vodacom is apparently now considering a separate listing of its South African financial services unit.

This listing could address what CEO Shameel Joosub says is a stock market discount to the carrier’s sum-of-parts worth. Presumably he sees greater disclosure as a way of encouraging the market to give the company more credit for this asset.

Vodacom has certainly been busy when it comes to financial matters. As we reported last week, Vodafone Group is transferring its 55 percent majority holding in Vodafone Egypt to its sub-Saharan Africa-focused unit Vodacom Group.

Vodacom is also looking for partners to grow fibre networks in operations outside of its home market, according to local press quoting its CEO.

With this presumably in mind, according to TeleGeography's CommsUpdate, Vodacom South Africa recently entered into an agreement to acquire a co-controlling interest in all of the material assets currently owned by Community Investment Ventures Holdings (CIVH), including Vumatel and Dark Fibre Africa (DFA).

Vumatel has a significant fibre-to-the-home (FTTH) network, passing over 1.2 million homes. DFA operates a national metro and access fibre infrastructure across South Africa.

Once the transaction is completed – and there may be regulatory hurdles before that happens – Vodacom will hold a 30 percent equity interest in a new entity known as InfraCo, that will house these assets as well as certain fibre assets which Vodacom will contribute into InfraCo.

Vodacom also has an option to buy an extra 10 percent in InfraCo within 180 days of the deal completing. 

And that’s not all. As we report today, Vodacom is planning to separate its telecoms towers portfolio into a new unit.

All of which could allow the African communications giant to get more value out of its operations, though there may be added urgency to this approach given that rival MTN has made some headline-grabbing moves of its own, not least today’s tower sale announcement.

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