Telkom buys 75% of Nigerian firm

JOHANNESBURG – South African fixed-line operator Telkom said on Thursday it had acquired a 75 per cent stake in Nigerian private telecommunications operator Multi-links for US$280 million.

Multi-links provides fixed, mobile, data, long-distance and international telecommunications services throughout Nigeria. Cadiz African Harvest portfolio manager, Rajay Ambekar, said: “It is a great acquisition and the price they paid seems not to be over the top…and provides Telkom with good growth opportunities.”Multi-links had all the key technologies that Telkom could build on, he added.”What would be interesting to see on the mobile side was how Vodacom would get involved.There is lots of potential,” he said.Mobile phone operator Vodacom is jointly owned by Telkom and Britain’s Vodafone.Multi-links operates a fixed wireless network on the CDMA platform in several Nigerian cities and last year acquired a unified licence to offer the full complement of roaming voice, Internet and data services.Nigeria’s mobile GSM market is dominated by three companies: South Africa’s MTN, Celtel – a unit of Kuwaiti MTC – and Nigeria’s Globacom.Telkom wants to expand into Africa to exploit relatively untapped demand for voice and Internet access on the world’s poorest continent and to help offset sagging revenues at home, where it faces competition from mobile operators and a new fixed-line firm.It has been trying for several years to break into new markets but had to scrap a previous plan to push into Nigeria and has yet to secure a deal it has touted in Uganda.The Multi-links transaction is the group’s second foray into the continent after its Africa Online acquisition announced in February for US$20,27 million.Telkom said it had bought Africa Online from unlisted London-based holding firm African Lakes Corp in a deal that will beef up its data business and provide access to nine African countries.Nampa-ReutersCadiz African Harvest portfolio manager, Rajay Ambekar, said: “It is a great acquisition and the price they paid seems not to be over the top…and provides Telkom with good growth opportunities.”Multi-links had all the key technologies that Telkom could build on, he added.”What would be interesting to see on the mobile side was how Vodacom would get involved.There is lots of potential,” he said.Mobile phone operator Vodacom is jointly owned by Telkom and Britain’s Vodafone.Multi-links operates a fixed wireless network on the CDMA platform in several Nigerian cities and last year acquired a unified licence to offer the full complement of roaming voice, Internet and data services.Nigeria’s mobile GSM market is dominated by three companies: South Africa’s MTN, Celtel – a unit of Kuwaiti MTC – and Nigeria’s Globacom.Telkom wants to expand into Africa to exploit relatively untapped demand for voice and Internet access on the world’s poorest continent and to help offset sagging revenues at home, where it faces competition from mobile operators and a new fixed-line firm.It has been trying for several years to break into new markets but had to scrap a previous plan to push into Nigeria and has yet to secure a deal it has touted in Uganda.The Multi-links transaction is the group’s second foray into the continent after its Africa Online acquisition announced in February for US$20,27 million.Telkom said it had bought Africa Online from unlisted London-based holding firm African Lakes Corp in a deal that will beef up its data business and provide access to nine African countries.Nampa-Reuters