Telkom has for the first time confirmed that it is in discussions about a possible acquisition of mobile network Cell C, writes GARETH VAN ZYL.
The confirmation came in a cautionary announcement to Telkom shareholders on Monday morning, after several reports have surfaced this year about a possible deal with Cell C.
Saudi Arabia’s Oger Telecom is Cell C’s biggest shareholder, with a 75% stake in the South African mobile network.
“Shareholders are referred to the cautionary announcement released on SENS on 28 September 2015, and are advised that Telkom is in discussions regarding a potential transaction to acquire all of the shares of Cell C… Such transaction, if successfully concluded, may have a material effect on the price of Telkom’s securities,” said Telkom in its SENS announcement.
“Telkom is currently performing due diligence on Cell C,” said the company.
Cell C has previously reported that it has 22 million subscribers, which means it is South Africa’s third largest mobile network after MTN (29 million) and Vodacom [JSE:VOD] (around 30 million).
Telkom has South Africa’s biggest fixed line network with 3.439 million fixed lines, according to its annual results for the period ended March 2015.
In July, Telkom reported that its active mobile subscriber base has grown to just over 2.1 million subscribers, meaning that a purchase of Cell C would bolster its wireless efforts in the South African market.
Fin24
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http://www.fin24.com/Tech/Companies/telkom-confirms-bid-to-buy-cell-c-20151109
