Fixed-line operator Telkom will enter into a new empowerment deal after the Elephant Consortium sold its 7.2% stake in the company, but is not providing much information as to what shape the deal will take.
Telkom says it is “currently reviewing its options in terms of a new broad-based black-economic empowerment deal”. Elephant, which sold its shares on the open market, seems to have been Telkom's only significant empowerment partner.
The company has not provided any information as to whether a new plan would include a consortium of investors that would buy a stake, or whether it may issue shares to previously disadvantaged people.
However, Telkom is mum as to what form the deal may take, saying only: “Telkom is reviewing various available options.”
If Telkom decided to sell shares through the JSE to disadvantaged people, it may formulate a deal that could be reminiscent of Vodacom's Yebo Yetho offering. Vodacom put 6.25% of its South African operation in a special purpose vehicle, called Yebo Yethu, and then offered shares in the entity to the public, black partners, and staff.
The fixed-line operator adds: “Timelines will be communicated to the stakeholders once Telkom has reviewed all available options.”
Telkom has implemented empowerment practices in several areas within the company, in line with the Department of Trade and Industry's code of good practice in areas such as employment equity, enterprise development and preferential procurement.
However, despite the points awarded for each section, the company is only a level four BEE contributor, with 73.2 points out of a possible 100. The highest level possible is one.
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