Vodafone Group’s South African subsidiary, Vodacom, is in talks to take over the subscriptions of around 1 million mobile customers from rival telco, Cell C.
Sources close to the matter told journalists from Bloomberg that the two companies were in discussion over the possibility of migrating around a million contract paying mobile phone subscribers to Vodacom.
The deal would secure an upfront fee for Cell C, which is struggling under the weight of a $635 million debt pile. The deal would also relieve Cell C of the financial obligation of servicing these customers and subsidising their handset upgrades.
For Vodacom, the deal would represent an opportunity to further cement its position in the South African market, taking on a million new customers to whom it can potentially upsell a range of converged product and services.
The pair are reportedly some way off of striking a deal and talks are currently at an exploratory stage, according to Bloomberg’s sources.
Vodacom has over 110 million subscribers across a number of African markets, including South Africa, Tanzania and the Democratic Republic of Congo. Last month, Vodacom signed a deal with Liquid Telecom to access its legacy 3.5GHz spectrum – a key band for the rollout of 5G. Vodacom is expected to be among the first mobile network operators in Africa to offer 5G services.
At its peak, Cell C boasted over 20 million subscribers in South Africa. The company was launched in 2001 as a challenger operator to South Africa’s incumbent providers, MTN and Vodacom.