Mixed fortunes for South Africa’s Telkom

Mixed fortunes for South Africa’s Telkom

South African operator Telkom has experienced mixed fortunes over the past 24 hours. It has been one of the two early winners (along with fixed wireless access operator Rain Networks) in South Africa's mobile spectrum auction but, within the same day, has been forced to delay a planned sale of its tower unit.

According to the Independent Communications Authority of South Africa (ICASA) the opt-in phase of the bidding process, which allows smaller operators to acquire what is known as minimum spectrum portfolio (MSP), has been won by Telkom and Rain.

Rain’s 2x10 MHz in the 700 MHz band and 10 MHz in the 2600 MHz cost the operator ZAR 1.15 billion (about $76.5 million). Telkom obtained 2x10 MHz in the 800 MHz band for ZAR 1.50 billion (about $99.7 million).

Liquid Telecom and Cell C were also eligible but of those two only Cell C, along with the winners, made a valid bid.

Less positive news, however, has been reported regarding Telkom’s plans for its masts and tower business. This was recently spun off into a unit called Swiftnet for which Telkom had earmarked this month for a public listing in the reasonable hope of unlocking some of the unit’s value.

Local news reports suggest that Swiftnet operates 6,225 cellphone masts and towers and is South Africa’s largest independently run tower portfolio. We reported Telkom’s plan to list the business in September last year.

However, a brief statement has explained that this listing has now been postponed. According to Reuters the company said: "Given the recent global events, current market conditions and the impact on the capital markets, the board has resolved to postpone the separate listing of Swiftnet on the JSE (Johannesburg Stock Exchange)."

This may refer to the Russian invasion of Ukraine, which has triggered a sharp fall in equities across the world, although this was not made explicitly stated.

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