Cape Town | Friday
THE partial listing of South Africa’s Telkom is on track for the fourth quarter of 2001, but will be timed to ensure that it enhances and does not undermine the company’s value, government officials said on Friday.
”We are ready for the planned listing of Telkom in the fourth quarter subject to market conditions. We believe we will not disappoint the markets when we finally do list,” Public Enterprises Minister Jeff Radebe told reporters.
”We believe it is possible to list at the end of this year despite the turbulence in the global telecommunications market. The telecommunications market in South Africa is new and there is a lot of potential,” he said.
Analysts have said South Africa faces a dilemma over its most important listing, having to choose between profitability and credibility in an international market not yet convinced of the government’s commitment to large-scale privatisation.
Having promised to list in the fourth quarter, the government is under pressure to go ahead despite the worldwide decline in appetite for telecommunications stocks since the listing was first announced.
Radebe said there had been no final decision yet on what stake would be listed and declined to say how much the government hoped to raise in what is likely to be its biggest privatisation deal since the end of white apartheid rule in 1994.
It is expected between 20% and 30% of Telkom would be floated.
The Independent Communications Authority of South Africa (ICASA) would publish regulations to underpin the listing in August this year, he added.
Sivi Gounden, director general of the Department of Public Enterprises, said officials were monitoring the telecommunications market to ensure the best timing for the initial public offering.
”Telkom is a very good company and we are very upbeat about its prospects,” he said. ”Government has no intention of taking Telkom to the market in a way that would create value destruction. Clearly, it’s about building value by going to the market,” he said.
Radebe reaffirmed the government’s intention to seek a secondary listing in New York or London, but said no details had been decided.
”We have taken a decision in principle that there will be a secondary listing abroad,” he said. – Reuters