Telkom hires US bank for sale of Openserve stake

Telkom has kicked off the sale of a stake in its fibre business, as it seeks to unlock value for shareholders and boost profit.

The partially state-owned telecommunications group is working with Bank of America to gauge interest in the Openserve business from potential investors and strategic partners, a spokesman said in an e-mailed response to queries.

A representative for Bank of America declined to comment.

Openserve operates around 170 000km of fibre and legacy landline copper cables. Telkom said in February that it had received a number of expressions of interest in the business, and that a formal sales process would be launched by the end of its 2023 fiscal year.

The JSE-listed company is also in the process of selling its towers unit, which has attracted interest from independent tower operators including IHS Towers.

Read: Telkom to kick-start sale of Openserve stake

Telkom intends to update shareholders on its plans when it presents annual results in June, the spokesman said.

Read: Big speed boost for Openserve fibre customers

Shares in Telkom have fallen about 25% over the last 12 months, giving it a market value of R17.2-billion. MTN Group made an approach to buy Telkom in its entirety last year before talks about a deal stalled. — Vinicy Chan and Loni Prinsloo, (c) 2023 Bloomberg LP