Telkom Looking To Buy Endangered Cell C

Cell C has been in a dark place for the longest of times with things coming to a head when the South African telecoms company announced that it had made losses of R8 billion earlier this year.

Shortly after announcing the results, Cell C announced that they would be moving their network to MTN which would essentially make the company a Virtual Mobile Network Operator.

It seems that wasn’t the last twist of the Cell C. Telkom has now announced that they are in talks to buy Cell C despite talks still being in their formative stages:

Telkom has substantially concluded its due diligence, however, discussions are at a preliminary stage
The Potential Acquisition will be subject to Cell C completing a financial restructuring to ensure that its gearing levels are reduced to a sustainable level as specified by Telkom and commercial contractual relationships are renegotiated to terms acceptable to Telkom.
Telkom Statement

This is the third time that Telkom has attempted to purchase Cell C with the latest attempt proving futile after Cell C recapitalised under Blue Label Telecoms.

If the acquisition of Cell C does go through it would leave Telkom with around 22 million subscribers which is almost a 100% increase in subscriber numbers from Telkom’s 11.5 million subscribers.

It’s not yet clear how Telkom’s interest will affect Cell C and MTNs plans which were also reportedly in advanced stages.