Mobile telecoms company MTN is in talks to acquire Telkom’s entire issued share capital in return for shares or a combination of cash and shares.
In a statement on Friday, the telecoms group said the discussions are at an early stage and there is no certainty that the transaction would be concluded.
“The transaction, if concluded, may have a material effect on the price of the company’s securities. Accordingly, shareholders are advised to exercise caution when dealing in the company’s securities until a further announcement is made,” said MTN in a statement.
In a statement to its shareholders, fixed-line operator Telkom confirmed that discussions are taking place between the two companies.
“Shareholders are advised that MTN Group and Telkom have entered into discussions in relation to MTN acquiring the entire issued share capital of Telkom in return for shares or a combination of cash and shares in MTN,” said Telkom.
Currently, MTN has 34.5-million subscribers, making it the second-largest mobile operator after Vodacom. Telkom has 16.9-million mobile subscribers.
Telkom’s share price was up in excess of 25% in mid-morning trade on the JSE while MTN climbed a percent to R136.26 on the local bourse.
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