MTN brought into Vodacom discussions; consultant awarded USD21 million by Kinshasa court

31 Jan 2012

South Africa’s MTN Group is reportedly investigating options relating to the future of Vodacom’s Congolese operation, Vodacom Congo. According to local news source IT Web Business, a spokesperson for MTN, Rich Mkhondo, said that MTN, along with other parties with an interest in the cellco, were involved in the process of assessing various options for Vodacom regarding its investments in the Democratic Republic of Congo.

Vodacom is embroiled in a long-standing dispute with its local partner Congolese Wireless Networks (CWN) regarding the funding and structure of the venture. With the two so far unable to reach a mutually acceptable conclusion, and the case progressing slowly through courts in South Africa, DRC and Brussels, Vodacom has raised the possibility of selling its stake in the company. MTN and Angola’s Unitel have both expressed an interest in acquiring the stake, should Vodacom go ahead with the sale.

Meanwhile, a Kinshasa court recently ordered Vodacom to pay a consultant hired by the company to assist in negotiations with CWN betweenn 2007 and 2008 USD21 million. Moto Mabanga was paid USD2.8 million for the work, but has sued the company for a USD40.8 million ‘success fee’ that he believes he is entitled to. Although the amount awarded was just under half of the amount asked for, Mabanga believed the matter finalised. Vodacom is unlikely to accept the court’s decision, however. Spokesman Richard Boorman said: ‘We have not received the judgment on this matter so it is difficult to comment in detail. We would clearly have material objections to any judgment by a Congo court in which a monetary award was granted … while the contractual dispute is currently being heard in court in South Africa, which has jurisdiction on the issue.’

Congo, Dem. Rep., MTN Group, Vodacom Congo (DRC), Unitel (Angola),

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