Following Monday’s news of an acquisition bid, Serame Taukobong, the CEO of Telkom, South Africa's third-biggest telecom company, has apparently said his company does not need saving.
Telkom does, however, appear to be assessing the unsolicited offer from the former CEO Sipho Maseko, backed by the South African Government Employees Pension Fund, to buy a substantial stake in the partly state-owned company. Telkom has also been targeted for acquisition in the past by rival MTN and for a merger by FWA company Rain.
As Reuters points out, the economic picture for Telkom is hardly rosy at the moment. Telkom's shares have fallen by about 40% over the last 18 months, with operating margins hit by inflation and power cuts. Its full-year headline earnings per share have fallen 76.6%. The company said this week that it would not resume dividend payments for at least another year given its cash position and the state of the economy.
It has, however, been reported in the South African press that Communications and Digital Technologies Minister Mondli Gungubele has said the government has no intention of relinquishing its majority share in Telkom, and that it is still strategic to the state’s programme.
Meanwhile, it seems that Telkom may soon announce the sale of its towers and masts business. The TechCentral website has reported that Swiftnet, which houses the towers portfolio, will be sold in its entirety within the next few weeks, though who Telkom is selling the business to and for how much isn’t yet known.
Telkom had planned to list Swiftnet on the local stock exchange last year, but unfavourable market conditions caused by Russia’s war against Ukraine put a stop to the move.