PIC to meet Cosatu on Telkom stake

By Tracy Burrows for Telkom
Johannesburg, 18 Nov 2004

The Public Investment Commissioners (PIC) is to meet the Congress of South African Trade Unions (Cosatu) today to discuss the purchase of the Telkom stake previously held by Thintana.

This comes after Cosatu issued a statement expressing dissatisfaction over PIC`s move to acquire and warehouse the 15.1% Telkom stake.

The PIC said in a statement that it would meet Cosatu`s leadership today, at the request of Cosatu president Willie Madisha.

"Out of our respect for the meeting, the PIC will not be responding to the statement by Cosatu until after the meeting," said PIC. "We firmly believe that comments before the meeting would only serve to polarise the issue and thereby undermine the possibility for consensus."

Earlier this week, the PIC stepped in to buy Thintana`s stake in Telkom, amid controversy over plans by a black empowerment consortium to do so. 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 [former] communications director-general and Dimension Data SA chairman Andile Ngcaba and Women Investment Portfolio Holdings."

Cosatu issued statements criticising Ngcaba`s role in the deal, as well as the way in which PIC had bought the stake.

Cosatu said yesterday: "Cosatu and the Communications Workers Union (CWU) are at one in deploring the fact that the PIC, which manages the pension fund for public sector employees, has spent R6.6 billion of workers` money without any consultation with the unions or staff, in a project - the privatisation of Telkom - to which the majority of the unions are opposed.

"The CWU and Cosatu have consistently opposed Telkom`s privatisation and supported its re-nationalisation. While both the federation and the union have demanded that the sale of Telkom shares to the foreign-owned Thintana consortium be reversed, they are equally angry at the way in which this is being done. Workers` pension money is being used to oil the wheels of an already discredited deal which will make a small number of people very rich and which has raised serious questions about the involvement of former and current public officials."

Yesterday, the Cabinet came out in support of the deal, saying in a statement: "The process that has been entered into will ensure that Telkom shares previously held by Thintana revert to South Africans.

"In approving the principle of this transaction, government was guided by the following considerations: broad-based BEE; compliance with requirements of the Johannesburg Securities Exchange, ICASA and the Competition Commission; and Telkom`s long-term ability to deliver value to society and its shareholders."