Hola! Vodacom Mozambique

Pan-African cellular communications company Vodacom has won a GSM (Global System for Mobile Communications) license in Mozambique.

Vodacom currently operates in South Africa, Lesotho, Tanzania and the Democratic Republic of the Congo.

This announcement comes after news that Mozambique has overtaken Zimbabwe as South Africa's largest African trading partner with South African companies investing more than R25 billion in Mozambique over the past few years.

"Vodacom is convinced that the fundamentals underpinning Africa's fastest-growing economy are very much in order and that Vodacom Mozambique will in time impact positively on Vodacom's bottom line," said Andrew Mthembu, Deputy CEO of Vodacom Group (Pty) Ltd and MD of Vodacom International Holdings (Pty) Ltd.

Vodacom Mozambique is that country's second GSM licensee, with mCel being the incumbent operator. Vodacom International will have the majority stake in Vodacom Mozambique with local partners Emotel, a consortium of local businesspeople, public figures and the war veterans association.

Existing operator mCel is 74%-owned by the Government of Mozambique and 26%-owned by German company Detecon.

"As is the case with most African countries, the vast majority of the population is very poor. However, there is a wealthy segment of the population prepared to pay for cellular services in US dollars and large enough in size for our investment to be very worthwhile," commented Mr Mthembu.

Vodacom is forecasting a total market of some one million customers after ten years of operations and expects to win a market share of at least 50%. To help achieve this target, Vodacom Mozambique will be offering the latest value-added services and products similar to those available to Vodacom customers in South Africa. Vodacom's coverage in Mozambique will include all major cities and provincial capitals, many other smaller towns as well as some road coverage.

The regulator in Mozambique, INCM, issued invitations to tender in March 2002. Twelve companies expressed an interest and purchased tender documents. Four companies eventually submitted their bids to the regulator. The companies were Vodacom International, Econet International, MSI (operating under the Celtel brand) and Telecom Africa Corporation.

The two stages to the bidding process included a technical evaluation and a requirement to field financial offers for a license fee. Vodacom won the license after making it through the technical evaluation and after offering USD15 million for the license. Vodacom and the regulator will now enter into negotiations on 12 June 2002 to finalise the license conditions.

Mr Mthembu is Chairman designate of Vodacom Mozambique. The Managing Director of the new company will be announced shortly.

ENDS

NOTES TO EDITORS:

To help achieve the vision of a pan-African GSM cellular network, Vodacom International Holdings (Pty) Ltd was established on 1 April 2001. Vodacom Mozambique, Vodacom Tanzania Ltd, Vodacom Lesotho (Pty) Ltd, Vodacom Congo (DRC) s.p.r.l are all subsidiaries of Vodacom International (Pty) Ltd.

In December 2001, Vodacom was also awarded a licence to operate a cellular network in Zambia.