Trade union Solidarity is worried there may be job losses if the proposed merger between SA's MTN and India's Bharti Airtel goes ahead.
The two cellular giants are in exclusive talks until the end of this month over the proposed $23 million deal that will see Bharti acquire 49% of MTN, and MTN and its shareholders acquire 36% of the Indian operator.
Treasury officials will leave this evening to meet with Indian regulatory officials to discuss regulatory matters surrounding the proposed deal, says Treasury spokesperson Thoraya Pandy.
Meanwhile, Solidarity has called on MTN CEO Phuthuma Nhleko to give assurances that the proposed merger will not lead to job losses.
No support
“If the merger eventually leads to job losses, Solidarity will by no means support it,” says union spokesman Jaco Kleynhans.
“Local job creation and job security must be the first priority. Mergers between companies and the resulting duplication of posts have led to job losses in many cases in the past. Solidarity calls on MTN to give the assurance that this kind of situation will not arise,” notes Kleynhans.
The union is also concerned that service delivery levels in SA could fall if the merger goes ahead. “Employees transfer their expertise to foreign contractors and subsequently lose their jobs,” says Kleynhans.
“This course of events may have an impact on service delivery... The merger could lead to the transfer of certain MTN divisions to Bharti, which will put pressure on service delivery in SA.”
However, MTN SA accounts for only 20% of the group's operating profit.
Business Day quoted a Congress of South African Trade Unions spokesman as saying the federation “will of course defend our members' interests, especially regarding any jobs that will be lost. We will be guided by the Communications Workers Union.”
Government interest
communications minister Siphiwe Nyanda has expressed caution over the proposed tie-up.
According to Reuters, he told the Sunday Times in an interview that any deal should take into account that MTN is a "South African company with a footprint in Africa" and "we are interested that it should remain" here.
SA's government-owned Public Investment Corporation holds 21% of MTN.
The Independent Communications Authority of SA is waiting for MTN and Bharti to come to an agreement before it decides whether to call public hearings on the matter, says spokesman Sekgoela Sekgoela.
India's Economic Times has reported that president Jacob Zuma is set to discuss the issue of dual listings with Indian prime minister Manmohan Singh at this week's G20 summit in the US.
MTN would not comment on the unions' concerns.
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