The government`s Public Investment Commissioners has stepped in to buy Thintana`s 15.1% stake in Telkom, amidst controversy over plans by a BEE consortium to do so. The stake will be warehoused for the consortium.
There has been widespread criticism of the plan for a black empowerment consortium led by former communications director-general and Dimension Data SA chairman Andile Ngcaba and Women Investment Portfolio, to buy the 15.1% stake in Telkom held by Thintana Communications.
ANC spokesman Smuts Ngonyama was to act as an advisor on the deal.
The PIC said at a media conference in Pretoria this afternoon that it had acquired the 15.1% of the Telkom stake previously held by Thintana Communications LLC at a discounted price of R6.6 billion.
PIC CEO Brian Molefe said the stake would be warehoused for "a period of not more than six months on behalf of the Elephant Consortium, the consortium led by Ngcaba and the Womens` Investment Portfolio Holdings."
The PIC said the purchase took place in the context of the 1997 acquisition of a 30% Telkom stake by Thintana. In June this year, Thintana sold 14.9% of the stake in the open markets. Thintana also engaged in a competitive bidding process to dispose of the remainder of its stake in Telkom. The Elephant Consortium emerged the successful bidder out of the process subject to raising the funding required and meeting all conditions precedent.
The Consortium approached the PIC and other funders for finance. Following negotiations between the PIC and the Consortium, the PIC yesterday agreed to purchase the stake. Both parties will enter into negotiations to determine how the Consortium will acquire the stake from the PIC.
Ngcaba told ITWeb this afternoon: "We had very little time to close this deal, so we opted for this short-term warehousing." He said "certain issues" had yet to be concluded in the deal.
The PIC is a public entity that invests funds on behalf of public sector entities, including the Government Employees Pension Fund. With assets under management of R308.7 billion as at 31 March 2003, the PIC is one of the largest investment managers in South Africa.
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