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Time to say goodbye

By unknown | Jun 10, 2008 | COMMENTS [ 0 ]

Zweli Mokgata

Zweli Mokgata

Vodacom chief executive Alan Knott-Craig, confirmed yesterday that he would be stepping down at the company's annual results presentation, as reported by Business Times on Sunday.

Knott-Craig has led the company since its inception in 1993 to become the country's mobile phone service market leader.

He said: "I won't be leaving the country, and I won't be leaving the sector. I might maintain contact with Vodacom in an advisory position."

The move added weight to the company's imminent unbundling from major shareholder Telkom, which owns 50percent of the company. The remaining 50percent is in the hands of English telecommunications firm Vodafone.

Vodafone has expressed interest in acquiring a controlling stake in Vodacom in order to implement a more aggressive growth strategy.

Knott-Craig said that investing in Africa, where rival MTN has had a vast head start, was almost impossible as a result of the current shareholding structure.

The company's 12,7percent growth in customers and 17,1percent revenue growth has been largely due to growth in African operations. However, the conflicting interests of Telkom and Vodafone have slowed the process of major African investment.

Directors were very guarded about the future position of chief executive, as the decision would be made by the main shareholder - in this case Telkom.

Reuben September, Telkom chief executive said: "We have a very thorough process for selecting the candidate, and we want to make sure that it is someone who will be able to cope with the challenges of Vodacom's growth prospects."

The unbundling from Telkom has been hailed as the proverbial death-nail in Telkom's coffin following declining subscriber numbers and customer satisfaction.

However, Telkom's future may not be so bleak, according to Frost and Sullivan analyst Spiwe Chireka yesterday following the parastatal's annual results announcement.

While the company increased revenue by nine percent it boosted operating profit by less than 0,01percent (R14,5billion).

This was an improvement on recent results which saw profits declining. The deciding factor to Telkom's recovery was the acquisition of Nigerian telecommunications company, Multi-Links.


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