Telkom, a wholly owned subsidiary of Telkom SA Limited (“Telkom”), today announced it has entered into agreements to acquire 100% of MWEB Africa Limited (“MWEB Africa”) and 75% of MWEB Namibia (Proprietary) Limited.
The purchase price for the MWEB Africa group including AFSAT and MWEB Namibia is US$63 million (approximately R610 million). These shareholdings will be acquired from Multichoice Africa Limited and MIH Holdings Limited respectively, which are members of the Naspers Limited Group.
Telkom CEO, Reuben September, said the transaction gives impetus to the Company’s strategic imperative of becoming a Pan-African integrated service provider. “Expanding beyond the borders of South Africa provides Telkom with an opportunity to become less dependent on domestic revenue streams”.
MWEB Africa is an internet services provider in Sub-Saharan Africa (excluding South Africa) and also provides network access services in some countries. Although its operations are largely focused on corporate customers, MWEB Africa’s predominantly satellite-based internet access offerings allows the company to reach a wide range of customers, many of which are not reached by traditional fixed-line infrastructures.
MWEB Africa is headquartered in Mauritius with operations in Namibia, Nigeria, Kenya, Tanzania, Uganda and Zimbabwe, an agency arrangement in Botswana and distributors in 26 Sub-Saharan African countries.
The successful conclusion of the agreements being entered into is subject to conditions precedent, including regulatory approvals being obtained in certain African jurisdictions.
Commenting on the transaction, September said, “The acquisition further reflects Telkom’s strategy of expanding and deepening its footprint in key markets across Sub-Saharan Africa. This acquisition together with Telkom’s investment in Africa Online is expected to increase the value proposition of our product and service offerings to all customer segments in Sub-Saharan Africa. Telkom’s position as partner of choice for connectivity and related services in Africa is expected to be strengthened.”
Update: Naspers has terminated the auction of MWEB SA. “Given economic conditions globally and the contraction in credit markets, shareholders are also advised that Naspers has terminated the auction process for the disposal of MWeb SA," Naspers said in a SENS announcement.