MTN set to Acquire South Africa’s Telkom

The largest mobile network operator in Africa, MTN, and South African telecoms company Telkom have begun discussions regarding Telkom being acquired by MTN.

The acquisition structure, according to the release, will involve MTN acquiring the entire issued share capital of Telkom in exchange for shares, cash, or a mix of shares in MTN and cash.

Telkom continued by stating that there was no assurance that the transaction would happen and that the talks regarding a potential acquisition were still in their early stages.

Until a new notification is made, shareholders were also urged to use prudence while transacting in Telkom’s securities.

Despite being primarily privately owned, Telkom is today active in over 38 African nations. The South African government owns 38% of the business.

With 34.5 million subscribers, MTN is currently the second-largest mobile operator in the country, trailing only Vodacom (45.7 million), while Telkom comes in third with 16.9 million subscribers. As a result, the combined company will overtake Telkom as the largest mobile operator in the nation by subscriber base.

It is uncertain whether South Africa’s Competition Commission will approve the transaction, which would create a telecoms duopoly comprising of incumbent Vodacom and the new business created as a result of the deal.