Telkom announced late last week that it is to absorb its Q-Trunk division into Telkom, after the company had been up for sale for more than two years.
Q-Trunk is one of three licensed public radio trunking operators in SA providing two-way radio communications.
The wholly-owned subsidiary was put up for sale in August 1999 when Telkom announced it would follow a public tender process to find a new owner for the company. At the time, the company was expected to lose R27 million for the 1999 financial year. More recent figures are not available as the Telkom 2000/2001 annual report categorises the subsidiary as "other".
Telkom said the sale would allow the new owner to invest in the substantial infrastructure needed to expand the business.
Despite the rosy picture Telkom painted for the future of the business, the sale did not materialise, amid rumours that at least one potential empowerment buyer could not convince financial institutions to front the money needed.
But Telkom CEO Sizwe Nxasana says there was more than one potential buyer and that the price had simply not been right.
"There were a few people showing interest, but we didn`t just want to give it away," he says.
Nxasana says Telkom uses Q-Trunk internally for communications with its fleet of vehicles and "still has external customers". He believes the service still holds substantial price advantages compared to mobile telephony.
Radio trunking is most commonly used for fleet communications, both privately and by public emergency services.
Telkom says the re-integration of Q-Trunk is part of its streamlining efforts, but that the Q-Trunk brand name will be retained.
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Telkom to sell Q-Trunk
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