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Cell C investors considers future ownership of company

Goldman Sachs is currently working on a review of the carrier, CEO says.

Cell C’s shareholders are exploring options for the future ownership structure of the third-largest South African wireless carrier, Chief Executive Officer Jose Dos Santos said.

The company, which is majority owned by Dubai-based Oger Telecom, has fewer customers than Vodacom and MTN in Africa’s most industrialised economy and faces further pressure as both seek transactions to strengthen their position. Johannesburg-based Cell C is working with Goldman Sachs on a company review, Dos Santos said.

“The structure of the company is a shareholder issue and they are looking at their options from that point of view,” Dos Santos said in an interview in Johannesburg on Wednesday. “They’re looking at where the business is going to be tomorrow and that makes some very exciting options for them to look at. Something eventually may happen.”

South African mobile-phone companies have seen revenue squeezed in the past year due to tough competition, regulatory changes and lower consumer confidence caused by regular power cuts and higher taxes. While closely-held Cell C doesn’t report sales figures, market leader Vodacom raised the price of most subscription contracts in May after South African revenue fell 3.1% in the three months through December.

“The shareholders are looking at the landscape in South Africa,” Dos Santos said. They “are 100% committed to this company.”

Cell C’s subscriber based stood at 20.4 million at the end of March, compared with Vodacom’s 31.4 million at the end of last year, the company said on Wednesday. The carrier will continue to fight Vodacom’s proposed purchase of Internet provider Neotel, Dos Santos said.

©2015 Bloomberg News

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