A Cabinet committee made up of several members is being led by communications minister Dina Pule in a bid to explore possible options for Telkom, after Cabinet rejected a tie-up between the operator and KT Corporation.
At the beginning of June, Cabinet binned a proposed deal between Telkom and KT, which would have seen Telkom issue 20% more shares to gain about R3.3 billion - around a 10th of its annual revenue.
Telkom and the department are set to meet to discuss more options, and Pule has until about the end of this month to report back to Cabinet on proposed ways forward.
Department spokesman Siya Qoza says the department is “working very closely with Telkom to explore all available options”. He says Pule is leading a Cabinet committee that includes finance minister Pravin Gordhan, public enterprises minister Malusi Gigaba, state security minister Siyabonga Cwele, and military and veterans minister Nosiviwe Maphisa-Nqakula.
Pule is confident a report to Cabinet will be considered as mandated, says Qoza.
Vital asset
asset in government's plan to increase broadband and telecommunications services to all. The state aims to increase broadband penetration to 100% by 2020.
“Telkom also has the longest-wide backbone network, which, through the necessary investment, can deliver the country's urgently needed high-speed Internet access. Given this, Telkom has a lot to contribute in achieving both socio-economic benefits to the country, while pursuing commercial interests.”
On Friday, Gigaba - whose department oversees state-owned entity Broadband Infraco - said discussions with communications around possibly merging Broadband Infraco, Telkom and Sentech, were ongoing
Gigaba explained the current fragmentation in the state's ICT assets limits its capabilities. He added the DOC should lead the way in the consolidation of these assets. “We are looking to optimise government's capacity in the broadband space.”
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