Two groups bid on Thursday for a 51% stake in a new South African fixed-line phone licence to rival state utility Telkom, setting the scene for the country’s long-delayed start of telecoms competition.
The Independent Communications Authority of South Africa (Icasa) said it had received two bids by around 2:30pm (1230 GMT). They came from consortiums called Goldleaf and Optis.
Goldleaf consists of UK telecoms consultants PCA, made up mainly of former British Telecommunications executives, UK-based carrier Gateway Communications and Nigerian investor group Telecom Africa International.
Optis is a South African investor group, which says its technical partners in the bid include Shanghai Telecom, a unit of China Telecom.
The licence will cost R300-million over 10 years, and the winner is likely to have to invest about R10 billion rand.
”Icasa is very pleased with the applications and the interest shown in the equity stake”, particularly given the backdrop of depressed telecoms markets, Icasa Chairman Mandla Langa told a news briefing.
The government had earmarked 51% ownership of the licence for groups with telecoms experience, 30% for the telecoms arm of the state transport and power utilities and 19% for a black-led group.
The South African government confirmed on Thursday Icasa’s choice of black-run Nexus Connexion for the 19% stake.
Because the economy is still largely dominated by whites eight years after the end of apartheid, government policies aim to give the black majority a bigger role.
Analysts had been expecting a poor showing by foreign telcos given the high debt levels in the hard-hit sector and the many other attractive investment opportunities. They had predicted that no big-brand foreign telcos would risk such an investment.
The original deadline for bids had been 2pm on August 30. That was then extended to October 31, without a time specified. Goldleaf, and even some Icasa officials, presumed the 2pm cut-off on Thursday would stand.
But Optis’s bid came in about half an hour later.
”We have received two applications, and since this is not the end of the day… we are still waiting,” Langa said.
Telkom is 30% held by SBC of the United States and Telekom Malaysia. The government plans to list at least another 20% by next March. – Reuters