Telkom gets competition
“Business Connexion shareholders are advised that the company has received, and is in the process of considering, an expression of interest, which is subject to numerous conditions precedent, from another potential bidder to acquire the entire issued share capital of Business Connexion,” reads a company announcement.
On March 22 Telkom announced that it had received “in-principle” support from five key shareholders of BCX for an offer of R9 a share. Experts say that Telkom’s proposed takeover would have difficulty making it past the Competition Commission because Telkom is a key supplier of upstream inputs such as bandwidth.
Telkom’s most likely rival is Bytes technology, the subsidiary company of the Altron group. Earlier, Bytes CEO Dave Redshaw confirmed it had been part of the negotiations but said: “We just couldn’t meet expectations.” However, Redshaw said: “I still think it’s a great company and we’d be very compatible.”
Both Bytes and BCX are similarly empowered, and the deal would have fewer competition hurdles.
The price of the mystery bidder’s offer remains undisclosed; it is not inconceivable that it is lower than Telkom’s offer. Telkom has declared that it will not increase its offer. It seems the parastatal’s poker face may soon be tested.
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