Telkom CEO Sipho Maseko is "cautiously optimistic" the company's proposed acquisition of Business Connexion (BCX) will pass all competition hurdles, the City Press reports.
Telkom is bidding a cash amount of R6.60 a share to buy out BCX, valuing the company at R2.67 billion. When the operator made a previous bid for BCX eight years ago, the Competition Tribunal quashed the move and the deal fell through.
According to the City Press, Maseko says the deal will bolster Telkom's business and technology capacity. "What was very clear to us is that we needed to build a bit of muscle on the IT side and we reviewed quite a lot of options. BCX was still an appropriate proposition and fit from a strategic point of view for Telkom," he says.
"In our view, we think the world has changed and the market has changed locally and internationally. Mobile players are acquiring fixed players and over-the-top players are acquiring manufacturers of devices, so there is clearly a movement towards some type of collaboration or consolidation, which brings a lot of efficiency and actually enables those companies that do that to be a lot more competitive in the market," adds Maseko.
Maseko told the City Press that Telkom will be able to convince the Competition Tribunal that the context has changed drastically since the initial bid eight years ago. "Then we used to own Vodacom. Now we don't. So the world has changed a little bit."
The CEO also spoke of managing relations with unions, with the paper noting they were not informed of the looming deal.
"Because we are a listed entity, we needed to maintain a certain amount of confidentiality [in relation to] the transaction because, if we didn't do that, we [would have] exposed quite a lot of shareholders to potential value destruction because we would not have managed it properly," he said.
Maseko says there are no tensions with the unions and Telkom has notified them of the strategic direction it will take.
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