MTN not in talks to acquire Telkom, CEO says

File photo: Customers are served at a branch of South Africa's mobile operator, Telkom, in Johannesburg, South Africa, 2 March 2022. Reuters/Siphiwe Sibeko/File Photo

Mupita made the comments after Bloomberg reported on Thursday, 4 September, citing people familiar with the matter, that MTN is considering reviving talks to acquire Telkom, which has the country's largest fibre assets.

"There are no talks with advisers between ourselves and Telkom. We did discuss this at some time in the past, but there are no active discussions," Mupita told reporters. He added that he could not rule out future talks.

Telkom's shares jumped 13% on Thursday, 4 September, on the news. On Friday, 5 September, shares closed 8% weaker.

In 2022, MTN terminated early-stage buyout talks with Telkom after failing to reach an agreement.

Mupita has emphasised that in South Africa, as in Europe, the market needs to consolidate, both at the levels of infrastructure and telecom operator, to about two mobile network operators from the current four.

He said profit pools are limited in South Africa, "and we see that in the margins that are being generated, particularly by the number two and number three players."

On home connectivity, MTN wants to aggressively play in the fibre market, but unlike Telkom, which spent years investing in fibre rollouts, it does not have extensive fibre assets.

"The build is completely off the table. South Africa has built enough fibre, and it would be a poor allocation of capital to say we're going to build fibre on our own," Mupita said.

"So on fibre-to-the-home, it's going to be partnering or it's going to be an acquisition at the right price at the right time."