Telkom may look at buying Cell C: Maseko

Mergers, Acquisitions and Financial Results

Bloomberg recently reported that Cell C is working with Goldman Sachs to explore the possibility of a sale.

Citing sources familiar with the matter, Bloomberg said the possible sale would be to “domestic competitors”, which includes Telkom.

Telkom is a logical partner for Cell C, and according to Telkom CEO Sipho Maseko the company will indeed consider buying the mobile operator.

Speaking to 702’s Bruce Whitfield, Maseko said he would consider all options on the table.

“Cell C is doing quite well, and if they are formally on the market, you know, depending on what they are going for…” said Maseko.

“If the price is right, and the proposition is right, we can look,” Maseko said, adding that they are not currently talking to Cell C.

Talk that Telkom may be buying Cell C is nothing new. In October 2012 Business Day reported that Telkom and Cell C were “working on the finer details of a potential merger”.

Former Cell C CEO Alan Knott-Craig said in 2012 that market consolidation is inevitable. “Margins are thinning and smaller operators’ ability to compete is being hampered by lack of scale,” he said.

Knott-Craig said at the time that Telkom would need a stronger retail presence to boost its operations.

The most logical option for Telkom to rapidly grow its retail presence by millions of subscribers in South Africa would be a deal with Cell C.

Source: MyBroadband 19 February 2015