In separate but identical regulatory filings on Monday, MTN Group and Telkom said they remained locked in discussions about a potential combination of their businesses.
The routine filings, required periodically under JSE rules when companies are under “cautionary”, follow the stunning announcement in mid-July that they were in talks about a deal.
Despite potentially insurmountable regulatory and political hurdles, MTN has proposed acquiring the entire issued share capital of Telkom in return for shares (or a combination of cash and shares) in MTN.
Less than a month after MTN’s initial approach, challenger telecommunications operator Rain said on 11 August that it planned to table a proposal to Telkom that it should merge with Rain instead of pursuing a deal with MTN.
However, Rain quickly found itself in trouble and was forced to retract its media statement about its intentions after it received a lashing from the Takeover Regulation Panel. Rain still intends to approach Telkom’s board with its proposal, it later said.
Meanwhile, on 12 August, a day after the Rain announcement, it emerged that government had received an unsolicited bid worth R7-billion for its 40.5% stake in Telkom from an investment firm called the Toto Consortium.