Here is who really owns Telkom

The South African government owns 40.5% of Telkom, while another 14.8% is owned by the Public Investment Corporation (PIC), which is closely linked to the government.

This means that government has power over the company — and is why it’s known as Telkom SA SOC (state-owned company).

Telkom always had close ties with the government.

It was born out of the government-owned Department of Posts and Telecommunications (DPT), which was broken into Telkom and the SA Post Office on 1 October 1991.

The government started Telkom’s privatisation journey when it allowed the fixed-line operator to join forces with mobile giant Vodafone to start Vodacom.

It went one step further when it allowed Telekom Malaysia and SBC to buy a 30% stake in Telkom in 1997 through the Thintana consortium.

On 4 March 2003, Telkom was listed on the Johannesburg stock exchange (JSE) and the New York stock exchange (JSE).

Although Telkom was delisted from the New York Stock Exchange on 27 August 2009, it remains listed on the JSE.

Many people see Telkom as a private company and a good case study of what the government should do with struggling state-owned enterprises like Eskom, Denel, and SAA.

The reality is that — although Telkom is a profitable company without many of the problems faced by poorly run, money sapping SOEs — it is essentially still under the control of the government.

Telkom’s annual report reveals that the South African Government, in partnership with the PIC, owns 55.3% of the telecommunications operator.

By owning over 50% of Telkom’s shares, the government can say what goes.

Here is who owns Telkom

The official figures show that the government owns 40.5% of Telkom, 49.6% is held by institutional shareholders, 3.4% is treasury shares, and non-institutional shareholders have 6.5%.

55% of the institutional shareholders are from South Africa, 24% are from the United States, 10% from the United Kingdom, 4% from Europe, and 7% from the rest of the world.

Telkom’s biggest institutional shareholders are the PIC (14.8%), T. Rowe Price Hong Kong (2.9%), Kagiso Asset Management (2.7%), Acadian Asset Management (2.5%), and Sanlam Investment Management (2.2%).

33% of institutional investors are value investors, 24% are growth funds, and 17% are index funds. It is interesting to note that only 11% are hedge funds.

The charts below show who really owns Telkom.

Telkom shareholders

Institutional shareholding by geography

Institutional shareholding by investment style (excludes the PIC)

Telkom’s top 10 institutional shareholders

Now read: 30 years of Telkom

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Here is who really owns Telkom