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Neotel revamp in bid to wrest market share

Johannesburg - Neotel, a unit of India's Tata Communications, said it is considering restructuring as it faces tough competition in South Africa.

Launched in 2006 after long delays, the company began offering telephone and internet services to corporate customers in March 2007, and has yet to turn a profit.

Neotel said in a statement it would consider "realignment and restructuring options". No one was immediately available to comment at Neotel.

It was not clear whether the restructuring would entail job cuts or closing down parts of the business.

Unlisted Neotel, South Africa's No.2 fixed-line operator, said it was trying to ensure it was sufficiently geared to meet the challenges of the market.

It competes for corporate clients with Telkom [JSE:TKG] , Internet Solutions - a unit of Dimension Data Holdings [JSE:DDT] , MTN Group [JSE:MTN] and Vodacom Group [JSE:VOD] business unit.

Neotel is rolling out wireless and fibre-optic networks to snatch fixed-line revenues from Telkom, which recently launched its own mobile unit.

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