MTN Group has recently made a takeover approach for South Africa's Telkom, Bloomberg reported, citing people familiar with the matter. Telkom has so far shown no interest in a sale, according to the report. It remains unclear whether the larger rival will continue its pursuit, the sources said.
MTN told Bloomberg that there is no deal on the table in relation to this matter and declined further comment. There was no comment from a representative for Telkom, said the news agency.
After a multi-year asset-disposal programme, MTN is flush with cash and looking to build on its core business. Telkom has a market value of USD 1.9 billion and a combination with MTN would help close the gap with rival Vodacom Group. MTN’s shares have risen more than 177 percent this year, valuing it at about ZAR 314.7 billion.
The two parties agreed a multi-year roaming deal last week under which Telkom uses MTN’s network. MTN is busy with a sale-and-leaseback deal of its South African towers, and Telkom is separating its towers business to prepare it for a possible listing of the unit. The state still owns over 40 percent of Telkom, which controls South Africa’s largest landline network and is expanding quickly with its own mobile network.
