{"id":551100,"date":"2006-12-15T06:38:40","date_gmt":"2006-12-15T06:38:40","guid":{"rendered":"http:\/\/localhost:8888\/wordpress\/technology\/551100-divided-board-backs-telkom.html"},"modified":"2006-12-15T06:38:40","modified_gmt":"2006-12-15T06:38:40","slug":"divided-board-backs-telkom","status":"publish","type":"post","link":"https:\/\/mybroadband.co.za\/news\/technology\/551100-divided-board-backs-telkom.html","title":{"rendered":"Divided board backs Telkom"},"content":{"rendered":"

Terms of the potential takeover expired yesterday, forcing both boards to decide whether it was worth fighting for permission to conclude a deal the Competition Commission wants vetoed. <\/font><\/p>\n

The firms agreed to extend the deadline to seal the deal until March 15, though the Competition Tribunal may not have begun adjudicating the potential deal by then. <\/font><\/p>\n

\u201cIt was a very long and tough debate,\u201d Business Connexion CEO Peter Watt said yesterday. <\/font><\/p>\n

\u201cSome parties were unhappy with the decision but that\u2019s what a board is for, and the majority had to prevail.\u201d <\/font><\/p>\n

Telkom\u2019s offer of R9,25 a share swung the extension, particularly since Business Connexion shares are trading at a much less valuable R7,30. <\/font><\/p>\n

\u201cIn the interests of shareholders, as there is R9,25 on the table, we felt we needed to take it to a logical conclusion and understand whether the commission ruling can be challenged,\u201d he said. <\/font><\/p>\n

Telkom\u2019s share price rose R2 to R134, and Business Connexion gained 7c to R7,30 yesterday before both gave up some gains. <\/font><\/p>\n

The tribunal has proposed March 10 to 20 to hear argument on the controversial acquisition. Watt expects \u201csome slippage\u201d in the date, and doubts the hearings will have begun before the two boards have to recommit to the takeover or walk away. Watt said extending the deadline did not mean they would automatically go on with the hearings. <\/font><\/p>\n

Over the next few weeks the companies would collate statistics on market share for the services they offer to prove that a tie-up would not give them too much dominance in any sectors. <\/font><\/p>\n

They would find out what objections would be raised by industry players who oppose the acquisition and gather evidence to counter the objections. <\/font><\/p>\n

\u201cThis is not a final decision to fight on,\u201d Watt said. \u201cThere are gaps in our knowledge and processes that have to take place. If we are satisfied Telkom will have a strong case to put before the tribunal, we may extend it. If we don\u2019t have a strong case, we may not take it forward.\u201d <\/font><\/p>\n

Telkom\u2019s move to buy one of SA\u2019s leading ITplayers has upset the 100 member Internet Service Providers\u2019 Association and Internet Solutions, one of SA\u2019s largest data carriers for corporate SA. <\/font><\/p>\n

The commission upheld their complaints, saying the deal should be vetoed on anticompetitive concerns. Commissioner Shan Ramburuth said fair access to telecoms network infrastructure was essential, and the acquisition would frustrate that. <\/font><\/p>\n

Both parties provided electronic communications and managed network services, and the merger would enjoy such a high market share that Telkom could raise its prices, he said. <\/font><\/p>\n

Telkom could also raise the fees it charged rivals to access its network, and could cross subsidise its activities to price rivals out of the market. <\/font><\/p>\n

Discuss this article<\/a> <\/p>\n

\n","protected":false},"excerpt":{"rendered":"

THE share prices of Telkom and Business Connexion rose yesterday after a \u201clong and difficult\u201d debate saw Business Connexion\u2019s board resolve to keep supporting a R2,4bn takeover bid by Telkom.<\/p>\n","protected":false},"author":23,"featured_media":0,"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":[17],"tags":[],"class_list":["post-551100","post","type-post","status-publish","format-standard","hentry","category-technology"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/551100"}],"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\/23"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=551100"}],"version-history":[{"count":0,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/551100\/revisions"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=551100"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=551100"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=551100"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}