Telkom informed investors on Monday morning that it weas in talks to buy Cell C .
“Shareholders … are advised that Telkom is in discussions regarding a potential transaction to acquire all of the shares of Cell C. Such transaction, if successfully concluded, may have a material effect on the price of Telkom’s securities,” the telco informed investors on Monday morning.
Telkom said it “is currently performing due diligence on Cell C”.
TechFinancials.co.za reported on 23 September 2015 that the sale of Cell C, has seen some telcos drop out of the bidding race, because the country’s third mobile phone operator’s Dubai-based parent company, Oger Telecom, has placed a price tag that seems “too high”.
Sources close to the possible transaction said Telkom was the only serious bidder left in the race.
Buying Cell C will be equivalent to acquiring another capability that Telkom failed to build, even though it had billions of rand from selling its stake in Vodacom in 2008.
Telkom’s mobile business, which use to be called 8ta, has failed dismally to challenge the duopoly of incumbents, Vodacom and MTN.
Instead, Cell C has managed to shake-up the market and steal customers from MTN and Vodacom.
A deal with Cell C will enable Telkom to complete the puzzle in its strategy to be a fully converged player.