Government squashes Telkom buy-out talks

Government has denied that it has any plans to buy up shares in the struggling encumbent, Telkom, dismissing reports in the Business Day newspaper.

“There has not even been a discussion or talks inside the department about any proposal for Telkom,” Siyabulela Qoza, the spokesman for Communications Minister Dina Pule, said today, as reported by MoneyWeb.

Business Day quoted an unnamed source as saying that “The government is looking for a way to direct Telkom to meet its development agenda without being hampered by the rules of the JSE.”

Earlier in June, government rejected an offer to acquire 20% of Telkom by Korea-based KT Corp, saying that the company was a “strategic asset” in its plan to roll out Internet to all South Africans by 2020.

Analysts have said the rejection of KT’s offer underscored the apparent determination of the government not to cede control of a company that many in the ruling African National Congress view as an arm of government.

Telkom told MoneyWeb that it had noted the speculation surrounding a buyout and nationalisation of the company, but had not received any communication on the matter from any shareholders.

“Telkom is not in a position to pronounce on the ANC’s internal discussions on policy or any other matter whatsoever as it is not party to those discussions,” it said.

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Telkom reports 33% fall in headline profit

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Telkom, Korea Telecom transaction not going ahead

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Government squashes Telkom buy-out talks