MTN-Telkom deal speculation resurfaces

MTN Group is believed to be in discussion with Telkom regarding the sharing of infrastructure, according to a report from Bloomberg, citing “two people familiar with the matter”.

The report is light on detail; however, it notes that the discussions are around Telkom’s mobile unit.

Sipho Maseko, Group CEO at Telkom, recently admitted that the Telkom Mobile business is going through “a very difficult time”, and is in discussions with parties over future operations.

According to Bloomberg, Nik Kershaw, an MTN spokesman, declined to comment.

Telkom told BusinessTech: “As communicated at Telkom’s Interim Results announcement, there are discussions with various parties regarding Telkom Mobile.”

When rumours of a discussion between MTN and Telkom first surfaced in November, MTN told BusinessTech that, while it does engage with Telkom as part of normal business practice, it would not speculate on a possible deal with Telkom Mobile.

“In response to the recent speculation in the press around MTN and Telkom, in accordance with good governance, MTN does not comment on market rumour and speculation,” the group said in a statement.

“However, we note that as part of normal business practice MTN engages with companies such as Telkom on matters such as roaming agreements and leased lines and we continue to do this,” Eben Albertyn, chief technology officer at MTN SA said.

Bloomberg said that Telkom had held earlier talks with Vodacom about sharing infrastructure, citing “one of the people”.

Acting Cell C CEO, Jose Dos Santos, also recently hinted at a possible consolidation between two of South Africa’s newest mobile entrants.

Asked by BusinesTech whether Cell C is currently in discussions with Telkom Mobile over a merger, Dos Santos, Cell C chief commercial officer, and Acting CEO said: “Market consolidation is inevitable. Consolidation will help smaller operators build scale to compete more effectively with players that have significant market power.”

“There is likely to be some form of consolidation or partnership in the industry. However, any decisions on consolidation or future partnerships involving Cell C would be for our shareholders to decide upon.”

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MTN-Telkom deal speculation resurfaces