SA’s Telkom Group up for re-nationalisation at US$1.5 billion
The South African government is re-nationalising the Telkom Group given its importance to the growth of telecommunications infrastructure in the country, reports say.
The government is set to offer R24 ($3.00) a share and approximately R12 billion ( $1.5 billion) for the Telkom Group, MyBroadband reported.
“The government views Telkom as a strategic asset in the rollout of ICT infrastructure in the country, and is moving with speed to find a lasting solution that will make Telkom sustainable,” the Department of Communications (DoC) said in a statement.
The SA Government owns some 39 percent of the group but its stake adds up to 51 percent if the Public Investment Corporation’s (PIC) stake is added. According to MyBroadband, the Department of Communications (DoC) will later this week present to the cabinet three strategic options for the Telkom Group.
The firm’s shares increased 4.32 percent to R19.31 ($2.34 ) on the JSE on Friday (14 September) making the firm worth some R10 billion, half its value a year ago.
According to some analysts, the nationalisation was discussed in June at the ANC’s national policy conference.
Speaking to Bloomberg, ANC Treasurer General Mathews Phosa briefly confirmed having discussions about the future of the firm and said delisting was among the strategies being considered.
Experts say the SA government sees Telkom as important in the development of the country’s telecommunications infrastructure, and might play a central role in the rollout of its broadband programme by 2020.
Korea-based telecom KT Corp was set to acquire in cash a strategic equity shareholding of 20 percent in Telkom’s post-issue ordinary share capital in May, but the move was blocked in Cabinet in June.