Vodafone’s African consolidation could see sale of Ghana unit to Vodacom

Anonymous sources have told Bloomberg that Vodafone is considering selling its 70% stake in Vodafone Ghana to Vodacom Group, in which it also holds a majority share.

The move would come as part of a wider strategy of consolidation of Vodafone’s various businesses in Africa under the Vodacom banner. Africa is considered one of Vodafone’s core markets and, as such, has been an area of strategic focus for the group in recent years, while it pulls back from other markets. In 2019, for example, the company sold both its Maltese and New Zealand business units.

Bloomberg also notes that Vodafone Ghana’s management were instructed to report to Vodacom’s CEO in April last year, perhaps a key indicator of the companies’ future consolidation. 

Rumours of the sale to Vodacom remain unconfirmed, however, with the sources careful to point out that a deal with Vodacom is just one potential choice available, as Vodafone considers its options for the unit.

Meanwhile, for Vodacom itself the start of 2021 has been marred by a number of its mobile towers burned down by 5G conspiracy theorists in South Africa. In a statement, Vodacom urged people to report those “deliberately spreading fake news” to the government.

Vodafone agreed to acquire 70% of Ghana Telecom from the Ghanaian government back in the summer of 2008, for around $900 million. Since then, rebranded as Vodafone Ghana, the company has found itself struggling to do battle runaway market leader MTN in one of many African markets that remains relatively uncompetitive; MTN controls around 57% of the subscriber market in West African country, while Vodafone Ghana, its nearest competitor, holds just 22%. Last year, MTN Ghana was designated a significant market power by Ghana’s National Communications Authority, who said they would begin taking measures to quell the company’s market dominance.

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