Liquid Telecom acquires network operator Neotel, aims pan-African fibre network

Liquid Telecom,a major telecom player has announced plans to provide fibre network access across sub-Saharan Africa after acquiring Tata-led South African communications network operator Neotel.

Tata Communications of India and minority shareholders in Neotel led by Nexus Connexion agreed for Liquid Telecom to acquire Neotel for 6.55 billion rand after initial discussions for a merger with South Africa's largest mobile network Vodacom fell through by because regulatory approval was not granted.

To fulfil South African black economic empowerment requirements, Liquid Telecom is partnering with Royal Bafokeng Holdings (RBH), a South African investment group, which has committed to take a 30 per cent equity stake in Neotel.

Over the coming months, Liquid Telecom plans to make extensive upgrades and expansions to Neotel's network, delivering greater levels of high-speed connectivity to more customers across Africa.

Neotel was started as a second fixed line operator to rival the state-owned Telkom more than a decade ago, but has struggled to keep up in recent years with the strong emergence of mobile network competitors despite having built up considerable fibre networks across the country.

Now Liquid Telecom also plans to make substantial investment in Neotel's data centre capabilities, which currently include two Tier-III designed state-of-the-art data centres in Johannesburg and Cape Town.

For the first time, Neotel's operations and focus will also become pan-African. Its network in South Africa will link together with Liquid Telecom's extensive fibre footprint to offer access via a single connection to over 40,000km of cross border, national and metro fibre networks.

This will give Liquid Telecom unrivalled reach across Eastern, Central and Southern Africa.

"This changes everything! Liquid Telecom and Neotel joining forces is far, far more than just a change in logo," the company said in full-page advertisement in national media yesterday, announcing that Neotel logo would remain but change colour from orange to blue, with the words "LIQUID TELECOM"added below it.        

Nic Rudnick, Group CEO of Liquid Telecom, in a statement released by the company, said: "The refinancing of the company's balance sheet will see a revitalised Neotel enter the market with the ability to offer consumers and businesses greater quality services and products delivered through world-class networks."

"We believe that Liquid Telecom will deliver on the vision of a well-connected Africa, which will augur well for the South African telecom industry and Neotel's customers."