Telkom partners with the South African Government

Telecommunications company, Telkom and South African government are in talks to partner in rolling out broadband products amid buyers gunning to bid for the telecom company’s assets.

According to Moneyweb, Minister of Communications and Digital Technologies Mindli Gungubele said,  the partnership will include Telkom’s businesses such as the Openserve fiber unit, infraco SOC which is the government’s Broadband and broadcast transmission services provider Sentech.

This partnership announcement comes after Gungubele said on Tuesday that the government is not interested in selling its 40% stake in Telkom.

“We have almost agreed on how the partnership will work, we are at modalities now,” Gungubele said in an interview at Telkom’s office in Pretoria.

In year end March 31, Telkom reported its first loss in decade. The loss resulted to many being interested in acquiring the company’s assets just as South African’s third-largest wireless company warned of a potential assets writedown of about R13 billion.

Sipho Maseko who is former CEO of Telkom offered to acquire a 35% stake in Telkom. MTN Group also made its offer to buy Telkom last year.

Chairman Geoffrey Qhena said in the interview along with the minister, “We cannot stop people in being interested in Telkom. When the share price is low people want to take advantage.”

Telkom shares dropped by 0.2% earlier today in Johannesburg after it have risen by 3.3% earlier this years.

The partnership between Telkom and South African government will fulfil its idea to connect 80% of South Africans in the next three years, According to Gungubele.

“The relationship we have with Telkom as a shareholder has huge potential to turn the country’s future around,” the minister said.