After this offer was dismissed, they put a revised offer on the table, which was not significantly different from the initial offer.<\/p>\n
Telkom has also requested the Maseko consortium to provide further clarity on several matters, including the proposed offer price and funding certainty.<\/p>\n
\u201cAs such, discussions remain of an exploratory and non-consensual nature, there being no certainty that the outcome of these discussions will result in a transaction,\u201d it said.<\/p>\n
More recently, Telkom CEO Serame Taukobong said the company is worth over R60 per share, and any suitors should see that as a benchmark before making an offer.<\/p>\n
In the case of the Maseko consortium offer, Taukobong said no due diligence was done, and that is where the matter had ended.<\/p>\n
Last week, the Telkom board said it had decided not to continue discussions<\/a><\/strong> with the consortium.<\/p>\n \u201cIt is the board\u2019s view that the indicative proposal is not in the best interest of shareholders and that the current strategy will yield better value for shareholders,\u201d Telkom said.<\/p>\n The market was pinning its hopes on corporate action, and the news of terminating discussions sent the share price 6.69% lower on the day.<\/p>\n The decline continued on Monday morning, and the share price was down by another 5.7% by the time of writing.<\/p>\n History has proven that buying a controlling stake in Telkom is extraordinarily difficult and borders on impossible. Even buying a minority stake in Telkom proved impossible.<\/p>\n In October 2011, KT Corp, South Korea\u2019s largest telecoms company, announced its plan to acquire a 20% stake in Telkom in a deal worth R3.8 billion.<\/p>\n The partnership was a perfect fit, as KT Corp had great expertise and experience in creating a modern telecoms company offering high-volume, low-margin broadband products.<\/p>\n By mid-2012, KT Corp had completed due diligence and was already working alongside Telkom to build a new telecommunications powerhouse.<\/p>\n However, on 1 June 2012, Telkom advised shareholders on 1 June 2012 that the strategic venture with Korea Telecom Corporation would not go ahead.<\/p>\n Telkom said<\/a><\/strong>\u00a0the communication minister informed it that the cabinet had taken the decision not to support the transaction as proposed.<\/p>\n Soon afterwards,\u00a0The Korea Times reported<\/a><\/strong>\u00a0that senior officials at Telkom demanded \u201chuge kickbacks\u201d from KT Corp.<\/p>\n The paper said the rejection of KT\u2019s offer underscored the determination of the South African government not to cede control over Telkom. Many in the ANC view it as an arm of the government.<\/p>\n \u201cSenior officials at Telkom demanded huge kickbacks or bribes from KT. That\u2019s probably why the South African government cancelled the deal,\u201d a source told The Korea Times via e-mail.<\/p>\n \u201cKT Corp wasn\u2019t prepared to keep on paying kickbacks,\u201d the source was quoted as saying.<\/p>\n Telkom and KT Corp dismissed the allegations, calling it \u201cnot credible, reckless, regrettable and defamatory\u201d.<\/p>\n The KT Corp deal illustrated the challenge to acquire a stake in Telkom and working with the state-owned company.<\/p>\n Even when a deal makes perfect sense, the government can scupper it if it does not suit the political agenda at the time.<\/p>\n Rain management and founders<\/p><\/div>\n Telkom is also susceptible to behind-the-scenes manoeuvres, as seen when Rain scuppered the recent talks with MTN.<\/p>\n On 15 July 2022, MTN and Telkom announced they were in the early stages of discussions about MTN acquiring Telkom.<\/p>\n A merger made sense as it would have combined MTN\u2019s deep pockets and mobile market strength with Telkom\u2019s extensive fibre, tower, and property assets.<\/p>\n Armed with these assets, it could have rapidly expanded its fixed- and mobile data 5G products and assisted Openserve in significantly expanding its fibre-to-the-home coverage.<\/p>\n Such a telecommunications powerhouse could have hurt Rain, and it struck back with a brilliant corporate move which may be taught in MBA curriculums in years to come.<\/p>\n Soon after MTN and Telkom started discussions, Rain requested to present the Telkom board with a proposal to merge the two companies.<\/p>\n In September 2022, Rain made an official proposal to Telkom, suggesting the acquisition of Rain by Telkom for newly issued shares.<\/p>\n The Telkom Board said it was evaluating Rain\u2019s proposal. This did not sit well with MTN, which wanted exclusivity.<\/p>\n A month later, MTN said it terminated discussions after extensive engagements as the parties could not agree on the process going forward.<\/p>\n Telkom said MTN terminated discussions as it was not in a position to provide MTN with assurances about exclusivity.<\/p>\n Rain successfully prevented<\/a><\/strong>\u00a0the creation of a formidable competitor in the fixed broadband market by outmanoeuvring two of its largest competitors.<\/p>\n This article was first published by Daily Investor<\/a><\/strong> and is republished with permission.<\/em><\/p>\n Telkom’s share price plummeted after it announced that it terminated acquisition talks with a consortium led by former CEO Sipho Maseko.<\/p>\n","protected":false},"author":341108,"featured_media":466373,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[80335],"tags":[87045,86659,35,5694,26404,279,26406,109],"class_list":["post-499595","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-afrifund-investments","tag-axian-telecom","tag-headline","tag-korea-telecom","tag-public-investment-corporation-pic","tag-sipho-maseko","tag-south-african-government-employees-pension-fund-gepf","tag-telkom"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/499595"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/341108"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=499595"}],"version-history":[{"count":1,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/499595\/revisions"}],"predecessor-version":[{"id":499601,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/499595\/revisions\/499601"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/466373"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=499595"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=499595"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=499595"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}It is not easy to buy Telkom<\/strong><\/h2>\n
![\"\"](\"https:\/\/mybroadband.co.za\/news\/wp-content\/uploads\/2023\/07\/Korea-Telecom.jpg\")
<\/a><\/p>\nRegulatory and competition concerns<\/strong><\/h2>\n
![\"\"](\"https:\/\/mybroadband.co.za\/news\/wp-content\/uploads\/2022\/08\/Rain-management-with-former-communications-minister-Siyabonga-Cwele.jpg\")
<\/a>
\nNow read:\u00a0Telkom auctioning 50 properties for over R500 million<\/a><\/h3>\n","protected":false},"excerpt":{"rendered":"