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Telkom S/Africa to buy
NITEL
By Joseph Sesebo
GroupBusiness
Editor
(in
Johannesbourg,S.Africa)
�
A new suitor, TelkomSouth
Africa, has begun moves to buy government stake in the
NigeriaTelecommunications Limited (NITEL).
Telkom is
SouthAfrica�s national carrier and the largest telecommunications company inthe
country.
Its Vice
President(Corporate Business Development) Mike Mlengana disclosed the plan at a
breakfast meeting with Africaneconomic editors in Johannesbourg, South Africa
on Wednesday.
The firm is,
however,partnering Vodacom, a Global System of Mobile Communications (GSM)
operator onthe continent.
Mlengana said
Telkomhas had talks with Nigeria�s National Communications Commission (NCC)Vice
Chairman Ernest Ndukwe, Bureau of Public Enterprise (BPE) Director
GeneralJulius Bala and other major stake holders.
This was spurred,
heexplained, because Nigeria features greatly in the scheme of Telkom in its
planto expand business in Africa, and that it believes it will succeed in
acquiringNITEL.
�We are in theprocess
of undertaking a due diligence of the company and establishing itsworth. We are
optimistic that what we find would be an appropriate firm thatwill meet our
requirements�, Mlengana stated.
According to
him,Nigeria provides one of the greatest opportunities in the
telecommunicationssector in Africa. �To ignore Nigeria would be to ignore the
potential andthe rewards that it provides. Nigeria�s telecommunication�s
sectoris still growing and we believe that the potentials are great.
�This is not toignore
the fact that there are risks involved, particularly regarding exchangerate
instability, poor infrastructure and a host of other risk elements. Eventhese
do not make it less attractive�.
Although the companyis
also looking at other African countries such as Benin, Angola among
others,Mlengana said access to gateway licence provides great opportunities.
One area Telkom willbe
looking at is fixed line which still has a tremendous amount of
untappedpotential.
�The expansionof GSM
in the country notwithstanding, we are aware that there is still a longqueue of
unfulfilled demand for land lines and we want to tap into that marketand fill
the gap�.
That optimism
isfuelled by the fact that land lines in Nigeria have the lowest tariff
structureand that the majority of people will be pleased to have a system that
isefficient and costs less.
Telkom currently
hasthe infrastructure, experience and competence to run NITEL efficiently and
eventhe human resources to do so, Mlengana explained.
It has been
approachedby other telecommunications operators to help provide the
infrastructure thatwould enable them carry more traffic on their networks.
Nothing is conclusive yet, the details are still beingworked
out.
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