Vodacom, Vodafone launch partnership

MASERU –“One plus one equals three.”

It sounds weird mathematically but that is precisely how Communications, Science and Technology Minister Mothetjoa Metsing described the partnership between Vodacom Lesotho and Vodafone which was launched last Thursday.

“The partnership will bring tremendous synergic value to the two companies,” said Metsing during the official launch.

The marketing partnership will see Vodacom Lesotho selling Vodafone’s world-class products locally at “affordable prices”.

Vodacom Lesotho is the country’s largest mobile telephone services provider with about 80 percent of the market share.

Vodacom Lesotho managing director Godfrey Mbingo said the company will benefit from being part of a larger group.

He said the partnership will benefit the local consumers because they will be able to get mobile phone handsets and other telecommunications gadgets at affordable prices.

“The partnership makes us part of the bigger group and we stand to benefit from the advantages that come with being part of a bigger group,” Mbingo said.

“We are not partnering with nobodies. We are partnering with the best of the best.

“The partnership will give us the muscle to purchase more gadgets at a cheaper price. We can then pass the benefit to the customer by selling the gadgets at affordable prices.”

Vodafone is in 27 countries and has about 289 million customers.

It is the world’s leading telecommunications companies.

Vodacom is in five countries and is a leading brand in Africa.

“The telecommunications industry is ever changing. In order to keep up with the change companies need to partner with bigger groups that have the capacity to adapt quickly to the changes,” Mbingo added.

“We want to democratise the telecommunications sector and make phone affordable to as many people as possible.

“In addition if we sell more phones it means we increase our profits, employ more people and pay more taxes.”

He said telecommunications cannot afford sit back and whinge about the on ongoing global financial crisis.

“We have to continue spending more on new and innovative gadgets. The penetration rate in this country is barely 40 percent.”

Vodafone representative Bob Collymore said the partnership will bring significant value to the two companies.

“Vodacom will benefit from Vodafone’s size and international representation. Vodafone will benefit from Vodacom’s knowledge and expertise of the local market.”

“Vodacom Lesotho was unique in that it is the lowest cost operator in the group. We are launching in Lesotho first because it is strategically positioned geographically.”

He said despite operating from the smallest country, Vodacom Lesotho is the best performing in the group in terms of margins.

Vodacom was initially jointly owned by Telkom SA, which had a 50 percent stake while Vodafone had 50 percent.

Vodafone has however increased its stake in the Vodacom group to 65 percent through the acquisition of a 15 percent stake from Telkom.

The deal was worth US$2.48 billion.

The remaining 35 percent will be unbundled when Vodacom lists on the Johannesburg Stock Exchange in May this year.

Vodacom Lesotho is owned 88.3% by Vodacom while a locally controlled company Sekha-Metsi Enterprises owns the remaining 11.7%.

Vodacom Lesotho was awarded a licence for the operation of mobile systems in June 1995 and launched commercial services in May 1996 in partnership with the government.

Vodacom Lesotho’s customer base increased by 35.5% to 450 000 in the six-month period ended September 30 2008, up from 332 000 in the same period in 2007.

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