26 January 2009
Telkom’s African expansion has taken another step forward with the acquisition of an additional 25% stake in Multi-Links, giving the South African fixed-line operator full ownership of the Nigerian telecoms company.
Multi-Links is a national private telecommunications operator that has a Universal Access License, which allows it to provide fixed, mobile, fixed-wireless, international and data services in one of the continent’s fastest-growing telecoms markets. The company also owns an internet service provider license.
An independent expert has valued the 25% stake, to be purchased from Kenston Investments, at US$130-million (about R1.31-billion). Telkom acquired 75% of Multi-Links in May 2007 for $280-million.
“Our 100% ownership of Multi-Links not only meets Telkom’s broader investment criteria, but also provides us with the opportunity to expand our mobile capacity,” Telkom CEO Reuben September said in a statement last week.
Since Telkom’s acquisition of a 75% stake in Multi-Links two years ago, the company has increased its mobile subscribers from around 262 000 to more than 1.7-million as of the end of September last year. At the same time, the company has been increasing capacity in order to provide quality data products, especially to the corporate market.
September said that with its low penetration and pent-up demand for voice and data services, Nigeria was market that would help advance Telkom’s goals of becoming Africa’s leading information communication technology provider.
“The prospects for the company are strong, and by capitalising on Telkom’s access to international data connectivity, and the quality of such connectivity, Multi-Links is well-positioned to service corporate, wholesale and retail customers in Nigeria,” he said.
Preferred telecoms partner
September added that the Multi-Links deal demonstrated Telkom’s determination to expand both domestically as well as beyond South Africa’s borders, into areas of high growth, healthy returns and value creation for the company’s shareholders.
“We are investing in, and enhancing our long-term future by accelerating our drive towards becoming the preferred telecommunications provider and partner in Africa, as Telkom’s expertise allows us to provide the full spectrum of information communication technology solutions on the continent, including voice, mobile, data, video, and internet services.”
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