Telkom SA SOC Ltd. executives have met with South African government officials to discuss plans to sell a 39% state-owned stake and were told that potential buyers have been identified.<\/p>\n
\u201cThey have communicated that they have identified a buyer or buyers to sell to,\u201d Telkom Chief Executive Officer Sipho Maseko said in an interview in Pretoria on Friday. \u201cThe sale will most likely be done through a private placement.\u201d<\/p>\n
Finance Minister Malusi Gigaba said last month that he planned to dispose of a portion of the shareholding, currently worth about 10.4 billion rand ($723 million). That would raise money needed to support struggling state-owned companies, including South African Airways.<\/p>\n
South Africa has previously approached the Public Investment Corp., Africa\u2019s biggest money manager, about buying the shares. Deputy Finance Minister Sfiso Buthelezi, who is also the chairman of the PIC, said Oct. 25 that the administrator of government-worker pensions was interested in a deal, while private companies could also look at a purchase. The PIC already owns about 11% of Telkom.<\/p>\n
The government has \u201cassured us that the sale will be done in a disciplined manner,\u201d Maseko said.<\/p>\n
Uncertainty surrounding the government\u2019s stake has weighed on Telkom\u2019s share price, according to Bruce Main, a money-manager at Ivy Asset Management in Johannesburg. The stock slumped as much as 10% on Friday after the company reported a decline in first-half earnings.<\/p>\n
South Africa has been forced to transfer funds to the national airline after creditors including CitiGroup Inc. refused to roll over debt repayments. Two years ago, the government sold a stake in Vodacom Group Ltd. to the PIC to raise cash for Eskom Holdings SOC Ltd., the state utility.<\/p>\n