Competition Commission Recommends Approval of NewCo’s Acquisition of Octotel

The Competition Commission of South Africa has recommended that the Tribunal approve the proposed acquisition of Main Street 1800 by NewCo, with specific conditions attached. The acquiring company, NewCo, is controlled by IDEAS Infrastructure II GP (Pty) Ltd and STOA S.A, both significant players in the infrastructure sector. IDEAS, managed by African Infrastructure Investment Managers (AIIM) and ultimately controlled by Old Mutual Limited, operates domestically, while STOA is a French joint stock company.

IDEAS and STOA already have a strong presence in South Africa’s fibre-to-the-home (FTTH) and fibre-to-the-business (FTTB) markets through their investment in MetroFibre. MetroFibre is known for providing carrier-class Ethernet infrastructure, delivering fibre optic broadband connectivity to a wide range of clients, including internet service providers, resellers, and residential and business properties.

The target firm, Main Street 1800, is a subsidiary of Actis Peninsula 2 Limited, and it controls Octotel, a company specializing in open-access fibre networks in the Western Cape. Octotel’s operations focus on constructing and managing fibre networks, which are then leased to internet service providers for retail services to end users.

The Competition Commission has concluded that this transaction is unlikely to significantly reduce competition in the market, paving the way for approval. This acquisition could potentially enhance the fibre network infrastructure in South Africa, further supporting the growth of broadband services in the region.