Telkom takeover deadline extended

JOHANNESBURG – South African IT outsourcing firm Business Connexion has agreed to extend a deadline for Telkom’s planned 2,43 billion rand takeover, keeping alive the phone company’s expansion ambitions.

BCX and Telkom said in a joint statement both companies had agreed to push back a December 15 deadline for the deal, which has run into opposition from competition authorities, until March 15. BCX shares rose 0,97 per cent to 7,30 rand by 1006 GMT while Telkom stock rose 0,57 per cent to 132,75 rand.South Africa’s Competition Commission in November recommended to the Competition Tribunal – which has the last say on antitrust issues – that the deal be blocked on grounds it gave fixed-line operator Telkom too much market control.Telkom said it would fight to secure the deal – an essential plank of its drive to offset flagging fixed-line revenues by beefing up its data business.But that meant extending the December 15 deadline – a move BCX had said could cost it business by creating more uncertainty for clients.A rejection by BCX would have been a bitter blow to Telkom, which has failed to secure an acquisition despite repeated pledges to its shareholders it will do so.BCX shareholders have approved the deal but the board needed to extend the deadline.Both companies said a further announcement would be made in due course.Nampa-ReutersBCX shares rose 0,97 per cent to 7,30 rand by 1006 GMT while Telkom stock rose 0,57 per cent to 132,75 rand.South Africa’s Competition Commission in November recommended to the Competition Tribunal – which has the last say on antitrust issues – that the deal be blocked on grounds it gave fixed-line operator Telkom too much market control.Telkom said it would fight to secure the deal – an essential plank of its drive to offset flagging fixed-line revenues by beefing up its data business.But that meant extending the December 15 deadline – a move BCX had said could cost it business by creating more uncertainty for clients.A rejection by BCX would have been a bitter blow to Telkom, which has failed to secure an acquisition despite repeated pledges to its shareholders it will do so.BCX shareholders have approved the deal but the board needed to extend the deadline.Both companies said a further announcement would be made in due course.Nampa-Reuters