KT Corp sets sights on 20% Telkom stake

14 Oct 2011

In a cautionary announcement released to the Johannesburg Stock Exchange (JSE), Telkom South Africa has confirmed that it is in the midst of discussions with KT Corp of South Korea, with a view to divesting a 20% stake to the Seongnam-based telecoms giant. If the deal comes to fruition Telkom has indicated that it will sell a number of new shares to KT at a price of ZAR36.06 (USD4.59) apiece, in a transaction that could be worth as much as ZAR4.6 billion. Telkom’s JSE announcement reads: ‘Shareholders of Telkom are advised that Telkom and KT Corporation have entered into discussions regarding a potential strategic venture that would, if implemented, result in KT Corporation acquiring a strategic equity shareholding of 20% in the post-issue ordinary share capital of Telkom – excluding treasury shares reserved for Telkom employees share schemes – and the companies entering into long-term agreements to formalise the relationship and identified areas of mutual strategic and business cooperation … Shareholders are advised that whilst the discussions between Telkom and KT Corporation are progressing well, there is no certainty at this stage that these discussions will lead to a formal transaction being proposed or concluded. Shareholders are advised to exercise caution when dealing in the company’s securities until a further announcement is made’.

South Africa, KT Corp, Telkom South Africa