Vodacom Group CEO Pieter Uys

Vodacom will make a decision about what to do with its troubled business in the Democratic Republic of Congo by the end of this year, says the group’s CEO Pieter Uys.

“The company is still running and there is a board meeting coming up soon,” Uys says. He doesn’t say what will be discussed at the meeting.

TechCentral broke the news in January that relations between Vodacom and minority shareholder Congolese Wireless Network (CWN) had come unstuck.

CWN accused Vodacom of repatriating profits from the joint venture, money it believes should have stayed in Congo.

Vodacom retaliated, saying it any financial arrangements were explicitly agreed to by the minority shareholder.

Vodacom owns 51% of the business through a subsidiary based in Mauritius; the remainder is held by CWN, which is headed by businessman Alieu Conteh.

Vodacom’s relationship with Conteh goes back to 2001 when the SA group acquired its stake in the then-fledgling mobile operation in the troubled central African nation.

Fractured relations between Vodacom and CWN have been threatening the joint venture for years. CWN has warned it could take legal action against the JSE-listed group if it doesn’t get its way.

In a bid to save its business in Congo, Vodacom earlier this year initiated arbitration proceedings under the International Chamber of Commerce rules.

Uys says Vodacom is still hopeful the situation will be resolved. However, he says it all depends on how long the arbitration process takes and the outcome.

“It could take years, or it could take months. By the end of the year we will know where we are with Congo,” he says.

Despite the effort Vodacom says it has put into saving the relationship with its Congolese partner, Uys says there is still a possibility Vodacom will cut its losses and pull out.

“If we can’t find any other solution, we will potentially look at an exit,” he says.

Vodacom Congo had 3,3m subscribers at the end of March, making it Vodacom’s third largest operation after SA and Tanzania. However, it’s contribution to group profits is negligible.  — Candice Jones, TechCentral

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