Telkom SA mulling ZAR13bn bid for Cell C

22 Feb 2017

South African telecoms provider Telkom is reportedly considering a ZAR13 billion (USD991 million) bid for domestic wireless operator Cell C, which is currently trying to complete a recapitalisation process, TechCentral reported citing three people familiar with the matter. According to two unnamed sources, investment banks are also approaching other potential bidders, which may be interested in taking over the struggling cellco. While Telkom’s representatives declined to comment on the matter, Cell C’s spokesperson Karin Fourie was cited as saying: ‘The Cell C recapitalisation remains on track and is supported by the equity investors, as well as the existing lenders to the business.’ Telkom had previously held talks with Cell C’s management over a potential takeover, though the two sides failed to agree on price. In November 2015 Telkom issued a cautionary announcement to its shareholders that it was performing a due diligence on the wireless operator, though Cell C’s Dubai-based parent Oger Telecom subsequently rejected a ZAR14 billion offer for its 75% controlling stake in the South African company.

As previously reported by TeleGeography’s CommsUpdate, in October 2016 Blue Label Telecoms agreed to acquire 45% of Cell C via its subsidiary The Prepaid Company (TPC), though the deal was opposed by Cell C’s minority shareholder CellSAf, which filed a legal claim to block the agreement claiming it would unfairly dilute its shareholding.

South Africa, Blue Label Telecoms, Cell C, Telkom South Africa