MERGERS, ACQUISITIONS AND FINANCIAL RESULTS
Telkom South Africa looks to Africa again
Telkom is still keen to expand its operations elsewhere on the African continent despite the sensational failure of Multi-Links, its Nigerian business, says chairman Lazarus Zim.
He was speaking at the group’s 2011 annual general meeting of shareholders on Tuesday in Midrand.
“We need to remain the wholesaler of choice and build a sustainable African business,” Zim says. Just because the group has had “challenges” in Nigeria, doesn’t mean it’s lost interest in seeking opportunities elsewhere on the continent outside its home market of SA. Zim doesn’t say if the group is already considering specific investments.
“There were expensive and important lessons that we learnt [from Multi-Links],” Zim says. “We are fully committed to building a sustainable, good and profitable African business.”
Telkom lost more than R7bn through its decision to buy and invest in Multi-Links, which operates a CDMA (code division multiple access) wireless network in Nigeria. Multi-Links was brought to its knees through a combination of bad management decisions and investment in the wrong technology — the West African nation is dominated by operators that use the competing GSM technology.
Telkom reached an agreement recently to sell Multi-Links to an affiliate company of Helios Towers Nigeria for US$10m, “which may increase depending on the achievement of certain conditions”.