Telkom delist a rumour, says PIC

Telkoms’ reported delisting from the JSE was a market rumour based on announcements by unions who were against the deal, according to the Public Investment Corp (PIC), a major investor in the group.

Government owns 39.8% of Telkom, while the Public Investment Corp (PIC), which invests state employees’ pensions, holds a 10.9% stake in the telecoms operator.

Citing a source close the communication department, Business Day newspaper reported that  government could delist and nationalise the struggling telecoms operator, while the Communications Workers Union (CWU) in June, stated that Telkom should be under state ownership.

“The government is looking for a way to direct Telkom to meet its development agenda without being hampered by the rules of the JSE,” the nation’s leading business daily quoted the source as saying.

Maqhawe Dlamini, head of equities at the PIC told BusinessTech: “The delisting of Telkom was a market rumour based on the subsequent pronouncements by unions against the deal.  We are not convinced that it is the intention of government at this stage, seeing that it is yet to consider the full spectrum of strategic options that Telkom will be presenting to them.”

“We believe that Telkom and government are working together to close the process gaps that arose as a result of Telkom not presenting more than just one option to government, which would have assisted it in the decision making- process for a higher conviction call by government. We see that as very prudent by government and have all the confidence that the both parties are working together to come up with a mutually beneficial solution.”

“We unfortunately cannot take part in that process as the lapsing of the A and B share structure put paid to our strategic relationship with government, thereby rendering us the ordinary shareholder that we are today. Any PIC involvement in the process underway, post that event, would have raised ethical issues around selective disclosure of information.”

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Telkom delist a rumour, says PIC