Telkom says reports it is considering trading cellphone network towers in a sale that could fetch between $500 million and $1 billion are "highly speculative".
However, it reiterates it is continuing its review of all properties, assets and infrastructure within the company's portfolio.
Yesterday, Bloomberg cited "people with knowledge of the matter" as saying the fixed-line incumbent was considering selling a network of its towers in SA, with bids set to open as early as next week. The reported amount translates to between R5.6 billion and R11.3 billion at current exchange rates.
"Telkom is working with consulting firm Accenture on the sale, which may attract tower operators such as IHS Holding of Nigeria and Helios Towers Africa", the sources were quoted as saying. "No final decision has been made and talks may still falter," they said.
Telkom communications head Jacqui O'Sullivan responded to queries saying the company could not comment on the report itself, but reiterated a statement Telkom has made in the past, indicating it was considering a range of options around its assets. "The primary focus of the review is to optimise the use of our facilities and assets while also considering any potential commercial opportunities."
MTN agreement
Telkom added a mobile arm to its business in October 2010, but has so far only managed to garner marginal market share.
In March last year, the company entered into a heads of agreement with MTN. This aimed to conclude network management services and reciprocal roaming agreements, with MTN taking over financial and operational responsibility for the rollout and operation of Telkom's radio access network.
Telkom CEO Sipho Maseko said at the time the agreement would allow the company to expand its mobile coverage, and reduce operating costs and capital expenditure "significantly". The deal is subject to approval from competition authorities.
Telkom has been pursuing cost-cutting exercises as a matter of priority for over a year now. In June last year, Maseko said efforts to restore its financial sustainability were starting to pay off, and the group expected it would be in a position to start paying dividends again this year.
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