The Competition Commission of South Africa has approved, with conditions, the acquisition of Pretoria-based Internet of Things startup IoT.nxt by mobile operator Vodacom.
Disrupt Africa reported in May that Vodacom, South Africa’s leading mobile operator, had agreed to acquire a 51 per cent stake in IoT.nxt, which has developed a unique technology stack that bridges the gap between all protocols in the industrial ecosystem, creating a single integration point that allows customers to easily integrate their IT platforms with IoT devices.
The startup has been expanding in Europe and the United States (US) after securing ZAR100 million (US$7.7 million) in funding in 2017 from investment holding company Talent10, and has agreed a number of key partnerships. The acquisition amount was undisclosed, and the deal was subject to approval by the Competition Commission.
That approval has now been granted, but with conditions. According to its weekly media statement, the commission found that Vodacom may have the incentive to bundle its offerings of voice, data and IoT services post-merger to the exclusion of non-vertically integrated rivals.
“This concern was also raised by other market participants whom the commission engaged with during its investigation,” the statement said.
To address these concerns, the commission, Vodacom and IoT.nxt have agreed to a remedy which will ensure that IoT.nxt’s products and services will continue to be made available to all customers on non-discriminatory terms post-merger. Specifically, this means that IoT.nxt will not supply its products and services exclusively to Vodacom.
IoT.nxt’s customers will also not be required to procure connectivity services from Vodacom when procuring gateways, edge platforms or cloud orchestration products and services from IoT.nxt post-merger.
“The commission further found that the proposed transaction does not raise any public interest concerns,” the statement said.