South Africa's leading mobile operator, Vodacom has signed a deal with privately owned operator, Neotel in a 100% acquisition for R7 billion ($676.8M).

The telco will finance the acquisition by using available cash resources and existing credit facilities. The move is in a bid to expand data services as well as internet having that Neotel's frequency would assist the telco add internet users as it competes against South Africa's biggest fixed –line operator Telkom and MTN.

Talks over the acquisition began late last year which has finally had closure over the impending issues and as of now the deal awaits regulatory approval and will allow the merged business to offer a variety of products and an enhanced customer choice before the end of the current financial year.

Vodacom plans to expand in markets such as Mozambique and DRC-Congo as the South African market has recently experienced congestion.

However, taking advantage of Neotel's extensive fibre assets and enterprise capabilities will allow Vodacom to accelerate its fixed enterprise strategy and stimulate greater competition in the state.