Telkom says the potential disposal of its masts and towers business is ongoing and shareholders are advised to exercise caution when dealing in its securities.
This follows the telco's initiation of negotiations with a preferred bidder for the sale of its Swiftnet tower business in November.
Swiftnet owns a portfolio of 6 200 communication towers in South Africa.
In a statement issued via SENS yesterday, Telkom noted that if the deal is successfully concluded, it may have a material effect on the price of the company’s securities.
“Shareholders are herewith further informed that continued progress has been made on meeting certain agreed milestones under the exclusivity arrangement, including that the bidder has completed its confirmatory due diligence,” reads the statement.
“Shareholders are advised that the exclusive negotiations may or may not lead to a transaction, and therefore, are advised to exercise caution when dealing in the company’s securities until a further announcement is made.”
According to Telkom, the preferred bidder is a consortium of equity investors (including a black economic empowerment partner), led and managed by a reputable private equity firm.
Shareholders were also informed that the transaction, if successfully concluded, will be subject to customary conditions precedent for such deals. These include securing regulatory approvals, and approval from Telkom shareholders, given that it would constitute a category one transaction in terms of the listings requirements of the JSE.