South African fixed-line operator Telkom said that discussions with South Korea’s KT Corp continue to be “positive” and that both companies are seeking to conclude a transaction “as soon as possible”.
A deal between the two companies,…
South African fixed-line operator Telkom said that discussions with South Korea’s KT Corp continue to be “positive” and that both companies are seeking to conclude a transaction “as soon as possible”.
A deal between the two companies, which may take the form of a strategic venture, would see KT Corp buy a 20% stake in Telkom for R36.06 (US$4.76) a share, or approximately US$496m in total.
Telkom stated that the “diagnostic review” has been completed. The companies now need to agree on the terms of the strategic venture before presenting the proposed transaction to their respective board of directors and shareholders for approval.
Telkom has hired Deutsche Bank as lead financial adviser and transaction sponsor, UBS as sponsor, Deloitte as co-adviser and Eversheds as legal adviser.
The South African company has seen its shares dropping by about 20% since the deal was first announced in October last year.
Telkom is 39.8%-owned by the South African government, 10.9% by Public Investment Corp., itself controlled by the government, while 47.3% is in free float.
