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07 Oct 2013 11:41
Vodacom is studying Icasa's proposed changes and will comment at a later date. (Gallo)
Vodacom Group, South Africa's largest wireless operator, fell the most in more than three months after the telecommunications regulator halved mobile termination rates for carriers.
The company's shares declined as much as 6%, the most since June 24, and traded 4.8% lower at R117.75 as of 10:54 am in Johannesburg on Monday. More than 2.2-million shares traded, above the three month daily average.
MTN Group, Vodacom's nearest competitor, was down 2.8%, its biggest fall in more than a month.
The fee mobile phones companies pay each other to end calls on another network will drop to 20 cents from March 2014, half the current price, the Independent Communications Authority of South Africa (Icasa) said in an October 4 statement on its website.
It will then fall by five cents in each of the following two years.
"The market is seeing it as Icasa's intention to drive prices down, so obviously there'll be pricing pressure" on the companies, BPI Capital Africa analyst Kate Turner-Smith said by phone.
The authority last revised call termination rates in 2010 after ruling the market was uncompetitive.
Vodacom and MTN dominate the mobile market, while state-owned Telkom is the leader for fixed-line calls. Vodacom is studying the proposed changes and will comment at a later date, the company's spokesperson Richard Boorman said in an e-mailed statement.
MTN didn't immediately respond to an e-mail seeking comment. – Bloomberg
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