{"id":21822,"date":"2012-09-11T10:58:22","date_gmt":"2012-09-11T08:58:22","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=21822"},"modified":"2012-09-11T11:00:20","modified_gmt":"2012-09-11T09:00:20","slug":"government-dragging-on-telkom-analyst","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/telecommunications\/21822\/government-dragging-on-telkom-analyst\/","title":{"rendered":"Government dragging on Telkom \u2013 analyst"},"content":{"rendered":"

An analyst has accused government of \u201cdragging Telkom\u201d after the Department of Communications (DoC<\/a>) delayed its expected presentation of an alternative strategy for the beleaguered firm to cabinet.<\/p>\n

The DoC was due to report back to cabinet on Friday (31 August) regarding alternative options available for\u00a0Telkom<\/a>, following government blocking the deal between the telecoms firm and\u00a0KT Corp<\/a>\u00a0at the end of June.<\/em><\/p>\n

However, the department may only present its plan for Telkom next week. \u201cThis plan is scheduled to take place next week,\u201d a spokesperson for the DoC told BusinessTech.<\/p>\n

In May, KT Corp and Telkom agreed to a deal whereby the Korean-based telecoms firm would acquire a strategic equity shareholding of 20% in the post-issue ordinary share capital of Telkom, by way of a specific issue of shares for cash.<\/p>\n

Having blocked the deal on 30 June, Cabinet asked the minister of communications,\u00a0Dina Pule<\/a>, to report back to it about all the options that were available for Telkom, in three months.<\/em><\/p>\n

\u201cThe Minister and her colleagues at the Inter-Ministerial Committee have worked very hard with government officials and Telkom to trim the list of option to three. These three options will be presented at the next Cabinet meeting that is scheduled for next week.”<\/p>\n

\u201cThe Government views Telkom as a strategic asset in the rollout of ICT infrastructure in the country, and is moving with speed to find a lasting solution that will make Telkom sustainable,\u201d the DoC said.<\/p>\n

Shares in Telkom have slumped below R18 in the most recent session, having started the year R28.42.<\/p>\n

Shares in Telkom had opened at R34.22 over the same period in 2011; however, poor results, a large fine over market abuse, and the KT block has seen investors lose faith in the group.<\/p>\n

Spiwe Chireka, program manager of telecoms at research and analysis firm, the International Data Corporation (IDC) told BusinessTech: <\/p>\n

\u201cIt is starting to appear as though the government blocked the KT deal without a concrete alternative plan. It is a known secret that Telkom desperately needs the money, and this is now typical of government when it comes to dealing with issues such as the one [regarding] KT.”<\/p>\n

\u201cOne of the issues with Telkom is its ineffectiveness to compete against the private entities; and one of its main Achilles’ heels is delay and bureaucracy. The main culprit in all of this is the government,” Chireka said.<\/p>\n

“While Telkom\u2019s exco has made it clear it needs the money and done its part in securing a potential partner (KT), it is the government that seems to be dragging Telkom,\u201d she said.<\/p>\n

Related article<\/strong><\/p>\n

DoC D-Day for Telkom<\/strong><\/a><\/p>\n

Investors \u201cwait and see\u201d on Telkom<\/strong><\/a><\/p>\n

Telkom to appeal R449m fine<\/strong><\/a><\/p>\n

Further Telkom pain on the way?<\/strong><\/a><\/p>\n

Telkom fine is credit-negative: Moody\u2019s<\/strong><\/a><\/p>\n

Telkom has not discussed delisting<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

An analyst has accused government of \u201cdragging Telkom\u201d after the DoC delayed its presentation of an alternative strategy for the beleaguered firm to cabinet.<\/p>\n","protected":false},"author":9,"featured_media":21826,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[1087,1083,26,625,2614,1781,445,65],"class_list":["post-21822","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-telecommunications","tag-department-of-communications","tag-dina-pule","tag-headline","tag-idc","tag-international-data-corporation","tag-kt-corp","tag-spiwe-chireka","tag-telkom"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/21822","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=21822"}],"version-history":[{"count":7,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/21822\/revisions"}],"predecessor-version":[{"id":21865,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/21822\/revisions\/21865"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/21826"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=21822"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=21822"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=21822"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}