Lycamobile enters South Africa telecoms market with Cell C deal

Out-Law News | 16 Aug 2017 | 4:51 pm | 1 min. read

Global mobile virtual network operator Lycamobile is to operate in South Africa under a partnership with domestic telecoms operator Cell C.

Lycamobile said the move expands its reach to 23 countries worldwide and marks the firm’s launch in sub-Saharan Africa – and into the “compelling” South African market.

Neither company gave details of what form the partnership would take. However, Cell C’s chief executive for wholesale business Björn Flormann said: “We have always been open to partnerships and this one promises to bring exactly what the South African consumer is looking for in a service.”

Lyca group chairman Allirajah Subaskaran said: “As one of the most influential and technologically-advanced countries in the region, South Africa is a natural choice for Lycamobile, as we continue to expand further into the thriving African telecommunications space.”

According to Lycamobile, South Africa has around 85 million unique cellular subscriptions. “As such this launch represents an opportunity for Lycamobile to expand its offering to a large and active customer base with excellent growth potential,” the company said.

Lycamobile, formed 11 years ago, said it currently serves 15 million customers globally across five continents. The operator recently launched in Ukraine and said its growth strategy is focused on launching in new territories including sub-Saharan Africa, Latin America and Southeast Asia.

According to the World Bank’s 'private participation in infrastructure database', the telecoms sector in sub-Saharan Africa was the sector with the largest investment share (68%) between 1990 and 2015. Total telecoms investment in the region over the period amounted to more than $114 billion, with 208 telecoms projects reaching financial close, the database showed.

In February, Pan-African telecoms operator Liquid Telecom announced plans to provide fibre network access across sub-Saharan Africa after acquiring South African communications network operator, Neotel, in a 6.55 billion rand (ZAR) ($487m) deal.

Liquid Telecom said then it planned “to make extensive upgrades and expansions to Neotel’s network, delivering greater levels of high-speed connectivity to more customers across South Africa”.

Earlier this month, the South African-based Vodacom Group finalised its acquisition of a 35% stake in Kenya's biggest telecoms firm, Safaricom.

Vodacom, which is 65% majority-owned by Vodafone, said the ZAR35bn ($2.7bn) acquisition was "the largest in the company's history".