OWN CORRESPONDENT, Cape Town | Saturday
THE South African government recommitted itself on Friday to holding the initial public offering (IPO) of the country’s telephone monopoly Telkom this year.
“This commitment was articulated in very clear terms by the president in his state of the nation address and the minister of finance when he delivered his budget speech,” said Public Enterprises representative Fani Zulu. His department is responsible for privatisation.
Zulu’s statement flies in the face of comments by Telkom Chief Executive Sizwe Nxasana that the timing of its IPO might have to be reviewed if the current downturn in world telecoms stocks continues.
“If the trend in the telecoms market continues, obviously there will have to be consideration given to the timing of the IPO,” Nxasana told reporters outside a Telkom presentation in Cape Town on Friday.
The rand and bonds weakened on the news.
Finance Minister Trevor Manuel said on Wednesday, when he presented the national budget for the year ahead, that the IPO was set for the final quarter of 2001. President Thabo Mbeki promised speedy privatisation in his speech last Friday.
Talk of a delay in the listing – the government’s biggest privatisation effort since the programme started in 1997 – sent the rand down to a then-record 8.01 to the dollar in January.
“If I was the government, I wouldn’t be happy to go to market in the current circumstances. It wouldn’t make sense to go to market now,” Nxasana said. “It becomes a value proposition which government has to consider carefully.”
But Zulu said everything was on track for the IPO.
“We have put in place the institutional infrastructure,” he said. “All the transaction working groups have been established and have long started doing their work.” – Reuters
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