MTN pragamatic as continues Telkom due diligence

BARCELONA – South African mobile phone group MTN is running its slide rule over the fixed-line assets of top South African fixed-line operator Telkom but has yet to decide whether to make an offer.

Chief Financial Officer Rob Nisbet said on Wednesday MTN was evaluating the corporate and small and medium-sized enterprise (SME) market, which Telkom would bring with it, as well as future revenue streams, capital expenditure and possible synergies and competition authority demands. But he emphasised at the annual Morgan Stanley investor conference in the Spanish city of Barcelona that MTN’s expertise lay in a high-growth mobile phone business that stretches from the booming markets of Africa to the Middle East.”We’ve never been a fixed-line operator.We’d have to ensure it makes sense,” Nisbet said, noting that a competition authority probe into any deal would take another six to 12 months.Market analysts have questioned why MTN would seek to buy the fixed-line assets of Telkom, which is 38 per cent owned by the South African government and which is seeing earnings come under pressure from rising competition.Asked whether MTN would welcome a deal that might include the South African government taking a stake, Nisbet said only that a government could be a supportive, minority shareholder.Nampa-ReutersBut he emphasised at the annual Morgan Stanley investor conference in the Spanish city of Barcelona that MTN’s expertise lay in a high-growth mobile phone business that stretches from the booming markets of Africa to the Middle East.”We’ve never been a fixed-line operator.We’d have to ensure it makes sense,” Nisbet said, noting that a competition authority probe into any deal would take another six to 12 months.Market analysts have questioned why MTN would seek to buy the fixed-line assets of Telkom, which is 38 per cent owned by the South African government and which is seeing earnings come under pressure from rising competition.Asked whether MTN would welcome a deal that might include the South African government taking a stake, Nisbet said only that a government could be a supportive, minority shareholder.Nampa-Reuters