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Vodacom in $700m Gateway acquisition

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Vodacom has agreed to acquire the carrier services and business network solutions subsidiaries of Gateway Telecommunications SA for an enterprise value of about $675-million plus a makewhole payment of approximately $25-million in relation to Gateway's high-yield bond.

Pieter Uys, CEO-designate of Vodacom Group, comments: "The acquisition of Gateway reflects Vodacom's strategy to reposition itself as a leading pan-African provider of communications services and to diversify from its current status as primarily a mobile-centric network operator.
"We believe that Gateway's significant presence across Africa will allow Vodacom to tap into the huge potential for growth in business services and connectivity and will enhance our position with multinational corporations."
Peter Gbedemah, CEOfficer of Gateway, adds: "This is an exciting milestone in Gateway's development as a unique pan-African service provider. We will increase resources, efficiency, and product range and continue our relentless focus on meeting the requirements of all Africa's mobile networks and multi-national corporations."
Gateway is Africa's largest independent provider of interconnection services via satellite and terrestrial network infrastructure for both African and international telecommunications companies. It also provides an extensive range of high quality, end-to-end connectivity solutions to multinational corporations operating across Africa.
Gateway employs about 350 people in 17 countries throughout Africa and Europe. For the year ended 31 December 2007, Gateway's sales were $257-million.
The broadcasting businesses held by Gateway Telecommunications (Gateway Broadcast Services Group) are not part of the transaction and will be retained by the current owners.
The acquisition of Gateway is in line with Vodacom's growth strategy.