Telkom to sell stake in Openserve

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

The South African telecommunications group is working with Bank of America Corp. to gauge interest in the Openserve business from potential investors and strategic partners, a spokesperson said in an emailed response to Bloomberg queries.

A representative for Bank of America declined to comment.

Openserve operates around 170,000 kilometers (105,633 miles) of fiber 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 Johannesburg-listed company is also in the process of selling its towers unit, which has attracted interest from independent tower operators including IHS Towers Ltd., Bloomberg News reported previously.

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

Shares in Telkom have fallen about 25% over the last 12 months, giving it a market value of 17.2 billion rand ($968 million). MTN Group Ltd., Africa’s largest telco operator, made an approach to buy Telkom in its entirety last year before talks about a deal stalled.

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