Blue Label Telecoms wants to bring in a new strategic investor into Cell C as it seeks total control of the mobile operator in which it currently holds a 49.5% stake. That’s according to Blue Label co-CEO Brett Levy, who was speaking to TechCentral in a wide-ranging interview on the TechCentral Show (TCS) to be published on Tuesday afternoon.
Levy’s comments follow the announcement last week that Blue Label will apply to the Competition Commission and communications regulator Icasa to take its shareholding in Cell C beyond 50%, a move that will give it control of the company for the first time. It could be a bank or a retailer or another network, but it will be a strategic partner.
In the TechCentral interview, Levy – who is joined on the show by his brother, co-CEO Mark Levy – said in response to a question about the future of Cell C: “Cell C will have a ‘big brother’. Whoever that may, that is coming – another investor, for sure.
“And it will be a value-adding investor. It will not be a money person; it will be someone who adds value in strategy,” he said. “It could be a bank or a retailer or another network, but it will be a strategic partner. And I don’t see that in five years, I see that in the next two to three years.”
Read also Ghana’s Oyster Agribusiness Secures Funding to Propel Sustainable Agriculture
Levy described Cell C as an “important cog” in the Blue Label machine. But, he said, Cell C “needs a ‘bigger bigger brother’ than Blue Label… We thought we were the big brother, [but] we became the little brother [and] now we need big brother. It will be a nice combination with us in it, and someone else.”
Read also : Digital Payment Service PayShap Closes in on a Million Transactions
The move to bring in a new strategic investor comes a year after Blue Label led a second recapitalisation of Cell C following its initial investment six years ago of R5.5-billion in the company, which bought it a 45% stake. Blue later wrote down the carrying value of that stake to nil after a turnaround strategy led by a previous Cell C management team did not deliver the expected results.
Levy said the strategy for Cell C this time is very different, with a far greater chance of success. Cell C no longer operates its own radio access network, for example, relying instead on the networks of MTN (for prepaid) and Vodacom (for contract customers), he said. This has reduced its costs, and meant it no longer has to try to compete with the capital expenditure of its bigger rivals.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry