Telkom pushing ahead with R8.7 billion tower business sale

 ·19 Feb 2024

Telkom is making progress in the sale of its mast and tower business, Swiftnet.

In a cautionary announcement on SENS, Telkom said that shareholders were previously advised that the group was in negotiations with a preferred bidder to sell its Swiftnet.

The telecommunications provider said the preferred bidder is a consortium of equity investors, including a BEE partner, led and managed by a private equity firm.

Nedbank previously said that the Swiftnet business is worth around R8.7 billion based on future expected cash flows.

Telkom has now said that substantial progress has been made on meeting the remaining agreed milestones under the exclusivity arrangement, including that the parties have significantly progressed their negotiations to agree on transaction agreements.

The company said that it expects to be able to make a more detailed announcement soon.

The deal is still subject to the necessary regulatory approvals and Telskom shareholder approval as it constitutes a Category 1 transaction in terms of the JSE Limited Listings Requirements – 30% of the issuer’s market capitalisation, or where the total consideration of the transaction is uncapped.


In a trading update for the quarter ended 31 December 2023, Swiftnet continued to commercialize and expand.

“The tower build program remained steadily on track with 9 towers and 4 In-Building Solutions sites being constructed during the quarter. The build pace increased in view of the demand that materialised during the quarter,” the group said.

Total revenue increased by 4.7% to R333 million, with revenue from growing customers increasing by 16.3% to R257 million. The group said that this was underpinned by escalations, new tenancies, 5G expansion and antennae upgrades.

Total EBITDA increased by 11.3% to R246 million, which was a result of the optimisation of tower operating costs.

Across the entire group’s operations over the quarter, revenue increased by 2.0% to R11.3 billion.

“Higher recharges by prepaid mobile subscribers, the ongoing rollout of fibre network to homes and enterprises by Openserve drove revenue growth,” the group said.

The group’s key financials can be found below:

  • Group revenue up 2.0% to R11 304 million

  • Group EBITDA stable at R2 477 million

  • Telkom Consumer growth driven by value propositions
    • Mobile revenue up 4.8% to R5 957 million
      • Mobile service revenue up 7.1%
    • Mobile EBITDA up 3.5% to R1 195 million

  • Openserve fixed data next generation revenue growth at 6.2%
    • EBITDA up 7.0% to R1 014 million
    • Fibre-to-the-home (“FTTH”) connectivity rate of 47.9%

  • BCX revenue marginally down at 0.7%
    • IT business revenue up 13.1% to R2 120 million

  • Swiftnet revenue up 4.7% from additional tenancies on masts & towers portfolio
    • EBITDA margin of 73.9%

This article has been updated to include the Trading Update For The Quarter Ended 31 December 2023.

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