Telkom in talks with MTN on network sharing

Telkom, Africa's largest landline provider, is in talks with the MTN Group to share the companies’ mobile-phone networks.

The discussions focus on the "potential outsourcing of the operation of the Telkom radio access network to MTN," Pretoria- based Telkom said in a statement on Thursday. The companies may also strengthen their relationship to include roaming on each other's networks, it said.

A deal between the two South African carriers would help Telkom reduce the cost of its wireless business while giving MTN, the continent's largest mobile operator, access to some of Telkom's spectrum, a person familiar with the matter told Bloomberg News this week. A successful deal "may have a material effect on the price of Telkom’s securities," Telkom said. 

Telkom shares increased as much as 5.1%, the most on an intraday basis in more than a month, and traded 2.8% higher at R33.09 as of 12.02pm in Johannesburg. The stock has gained 18% this year.

MTN has been reducing its network of towers by selling and then leasing them in Rwanda, Zambia, Cameroon and Ivory Coast as it cuts operational expenditure. Telkom paid R1.1-billion to other mobile network operators in the six months through September, compared with R1.48-billion a year earlier.

Telkom, which has had five leaders since 2007, is struggling to revive revenue among consumers in a country that has leapfrogged fixed-line technology in favour of smartphone devices that are driving a boom in data usage across Africa.

The company is trying to lower expenses, especially in its mobile business, which chief executive Sipho Maseko said he wants to reduce by at least 50%. – Bloomberg

Keep the powerful accountable

Subscribe for R30/mth for the first three months. Cancel anytime.

Subscribers get access to all our best journalism, subscriber-only newsletters, events and a weekly cryptic crossword.

Chris Spillane
Chris Spillane works from Barcelona, Spain. ✈ ✈ ✈ ✈ recovering journalist, former @business & @politicoeurope scribbler, views ≠ mine , are we having fun yet? [X] Chris Spillane has over 1885 followers on Twitter.

Related stories

WELCOME TO YOUR M&G

Already a subscriber? Sign in here

Advertising

Latest stories

International Day of Education: Countries set realistic goals for 2030

The original sustainable development goal for education treated all countries as equal; however, global targets have now been localised, providing a more realistic framework

Chieftaincy dispute hits Richards Bay Minerals production

The KZN department of co-operative governance has undertaken to resolve the dispute it created by dethroning the sitting inkosi in 2010

World Economic Forum: ‘2022 will be like navigating an obstacle...

Central banks massively underestimated inflation risks as economies bounced back from the pandemic-induced slump

Montana backs Prasa-fraud accused Mthimkhulu as court hears how he...

Montana testified that ‘unqualified’ Mthimkhulu was the right engineer for the state rail agency, despite his acquisition of allegedly faulty locomotives
Advertising

press releases

Loading latest Press Releases…
×