‘MTN’s proposed takeover of Telkom could lead to jobs bloodbath’

Trade union federation Cosatu has raised concerns about job security amid the proposed takeover of Telkom by MTN.

Cosatu, which is opposed to the merger, said on Tuesday that the amalgamation of the two big mobile telecoms companies would have a catastrophic impact on the survival of small, medium, and micro enterprises and could lead to a jobs bloodbath.

This as data and cellphone charges continue to rise above the international average and becoming a real impediment to economic growth and creation of jobs.

Cosatu national spokesperson Sizwe Pamla said: “These mergers of large companies have seen thousands of workers lose their jobs and have encouraged anti-competitive and monopolistic behaviour increase, including price gouging.

“Telkom in particular has seen thousands of jobs shed since it was listed, and highly qualified and experienced workers have been casualised.

“We cannot afford to see an already monopolistic sector riddled with allegations of collusion becoming even less competitive. Telkom for all intents and purposes, remains a publicly-owned company with the state and the Public Investment Corporation [PIC] having a collective 51%-plus ownership of the company.”

Pamla explained further: “Workers demand to hear from the state and the PIC which invests public servants’ pensions and Unemployment and Injury on Duty Insurance Funds on this critical matter.

“We intend to engage them and remind them that their broad mandate is to protect the interests of workers.”

According to Pamla, the Competition Commission needs to intervene in the proceedings of the proposed merger given that Telkom and MTN are both in “a highly concentrated and lucrative sector”.

“The Competition Commission will need to be firm in opposition to such predatory behaviour and consider previous price manipulation and other unsavoury allegations that have plagued players in the telecommunications sector.

“The government, the PIC, and the Competition Commission need to firmly and clearly come out and oppose this damaging proposal by MTN that has infamously abused its power and domination before.”

Sunday World reported on Sunday that for the deal to go through it would need buy-in from the government, which has a 40% stake in Telkom. Another significant player is the PIC, which manages public servants’ pensions.


The PIC has significant exposure on both sides, owning a 14% stake in Telkom, whose CEO is Serame Taukobong, and a 22% interest in MTN Group, which is headed by Ralph Mupita.

Read more:  MTN faces fierce resistance in its bid to buy Telkom

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