Pair of investors interested in loss-making Nigerian Multilinks
The chairman of Telkom South Africa, Jeff Molobela, has announced that at least two investors have shown interest in the company’s struggling Nigerian unit Multilinks, news agency Reuters reports. Molobela said that Telkom has received offers from two unnamed companies: a GSM operator and an infrastructure fund.
Telkom wrote down the value of CDMA operator Multilinks by ZAR5.2 billion (USD706 million) in the financial year ended 31 March 2010 and its chief financial officer told Reuters last month that selling the unit was ‘one option’, although it is not known whether Telkom will decide to retain the loss-making unit. In January 2010 Telkom’s board rejected a proposal by former CEO Reuben September to merge Multilinks with rival CDMA operator Starcomms, and the company has ruled out acquiring other operators in Nigeria as a solution for the losses made there.
Telkom bought 75% of Multilinks for USD280 million in May 2007. The South African company acquired the remaining 25% of Multilinks it did not already own from Kenston Investments in January 2009 for USD130 million.