MTN Group has opened acquisition talks with Telkom South Africa in a move that would bolster its ability to compete with market leader Vodacom.
Discussions are reportedly in the provisional stages, and the companies have stated that there is no guarantee of a deal. MTN did clarify that if a takeover is agreed, it would pay with either shares or a combination of stock and cash, given that the South African government holds a stake in Telkom SA.
This is not the first time that a deal between the operators has been mooted; we reported in November 2021 that MTN had expressed an interest in acquiring Telkom, and such a move would be in line with its wider strategy of divesting assets outside of its core markets in order to reduce its debt burden and refocus on its African operations.
MTN and Telkom are respectively the second and third largest operators in South Africa, so any merger of the two would face substantial regulatory hurdles since the resulting entity would take a clear lead in the market.
