Telkom patching its wounds: CEO

Telkom CEO, Sipho Maseko, is taking steps to revive the company’s fortunes, including retrenchments and a R2.7billion acquisition of listed ICT group, Business Connexion (BCX).

“Telkom won’t die…We needed to stop the bleeding, rehydrate and start eating solids again,” Maseko said of the restructuring process.

The process is anticipated to affect up to 2,635 management staff as the group aims to save R5 billion over the short to medium term.

“Customers want more services for less, and we need to start being more efficient,” Maseko told the Sunday Times.

“The bargaining unit will not be affected by the current round of retrenchments. I want my management team to do more with less.”

“Currently, there are about 12 to 13 layers between the customer and myself. I want to get this to about eight or nine layers — in line with other benchmark companies,” Maseko said.

Maseko also told the City Press that there was no tension with unions over the retrenchment process ,which is expected to see up to 1,000 managers lose their jobs.

“Because we are a listed entity, we need to maintain a certain amount of confidentiality…There is no tension between ourselves and the trade unions and we have had a number of interactions with them where we have shared the strategic directions that we are going to take.”

On Thursday (22 May) Telkom entered into an agreement to acquire BCX in a R2.7 billion cash offer funded from its own cash resources.

The purchase would include the entire issued ordinary share capital of BCX, but excludes the BCX ordinary shares held by Business Connexion as treasury shares.

Telkom will pay to the ordinary shareholders a cash consideration of R6.60 per ordinary scheme share.

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Telkom patching its wounds: CEO