On The Money - In Brief
- JSE-listed Spescom says the unpredictability of the telecommunications sector is likely to cause it to incur a headline loss of between R10 million and R14 million for the six months to March.
- Dissolution of an existing Board Management Committee, restructuring of both Board and Management, injection of more equity, and expansion of shareholders base are the strategies which MTS Firstwireless has embarked upon in its quest to expand its subscriber base to 350,000 lines. The company says it is embarking on such restructuring in response to various private and institutional investors who desire to invest in the company.
- JSE-listed Spescom says the unpredictability of the telecommunications sector is likely to cause it to incur a headline loss of between R10 million and R14 million for the six months to March. The loss represents at least a R30.6 million swing from the same period last year, when Spescom achieved headline earnings of R20.6 million. The group says in a trading update that the telecommunications business is fragmented by nature with trading heavily dependent on large deals and a small customer base. At the same time, the liberalisation of the market has not yet taken place and the impact of deregulation announcements still remains largely unknown, particularly regarding the second national operator. It also cites delays in the finalisation of long-term contracts and the awarding of new contracts.
- The long-running saga in which one of two bidders will be awarded a controlling interest in the long-delayed second network operator (SNO) will be announced ‘sometime in 2005’, according to a spokesperson from telecoms regulator ICASA. The pair of bidders for the 26% stake – Old Mutual Asset Managers and Tata Africa – registered their interest back in October, and had hoped that the regulator would make a speedy decision. The long delays have, some argue, given Telkom the opportunity to sign long-running contracts with many of its best corporate contracts. The SNO’s business case has been harmed further by ICASA’s decision to liberalise the telecoms markets from 1 February.
- Orascom Telecom Holding (OTH) has signed agreements to acquire additional stakes in its Algerian and Tunisian operations. Under the terms of the deal OTH will buy an additional 2.38% stake in its Algerian cellco (to take its holding to 62.14%) while in Tunisia its stake will rise from 20.47% to 22.47%. The purchases will cost OTH USD39.3 million.