Telkom, South Africa’s third-largest mobile operator, has disclosed the sale of its tower company, Swiftnet, for a total sum of $343 million (R6.5 billion).
The buyer, Towerco Bidco Proprietary Limited, comprises a consortium of equity investors led and managed by Actis, holding 70% of the purchaser’s shares, with Royal Bafokeng Holdings owning the remaining 30% stake.
Swiftnet, known for its extensive mast and tower infrastructure boasting over 4,000 installations and leased co-location space to major mobile network providers, has been on the market for nearly three years in search of potential buyers.
Telkom’s decision to divest from Swiftnet is in line with its strategic goals aimed at maximizing shareholder value.
The intention to sell Swiftnet was initially disclosed in September 2021 by then-Chief Executive Officer (CEO) Sipho Maseko, citing the unit’s undervaluation compared to the company’s shares.
Towerco Bidco, a freshly formed entity comprising a consortium of equity investors led and managed by Actis, holds a 70% stake, while Royal Bafokeng Holdings retains the remaining 30%.
Telkom’s move to offload Swiftnet corresponds with its broader objective of concentrating on core business activities and bolstering its financial standing by reducing debt and enhancing liquidity.
The current Telkom Group CEO, Serame Taukobong, views the sale as a pivotal step towards unlocking shareholder value.
He underscores that the transaction ensures seamless continuity for related businesses, particularly Telkom Consumer and Openserve, by guaranteeing continued access to Swiftnet’s infrastructure.
Actis managing partner, David Cooke identifies long-term potential in Swiftnet and anticipates ongoing collaboration with the telecom group to provide access services to Telkom Consumer and Openserve.
While awaiting shareholder and regulatory approvals, Telkom remains optimistic about the transaction’s potential benefits.