MTN Group is once again exploring the opportunity to acquire its South African rival Telkom, a move that could significantly alter the dynamics of the local telecommunications market.
Overview of the Deal
MTN Group, the largest telecommunications company in Africa, intends to revive its plans to acquire Telkom. This decision comes after MTN walked away from negotiations in 2022. According to Bloomberg, this move is part of MTN's strategy to broaden its reach and strengthen its dominance in the African telecommunications market.
Competition in the Telecom Market
If the deal goes through, MTN would add Telkom's 23 million subscribers to its existing base of 298 million subscribers across 15 African markets. Both companies are expected to initiate new negotiations by the end of 2025, although there remains a risk that the deal may not receive antitrust approval, as previously experienced.
Forecasts and Expectations
Should the deal take place, it would significantly bolster MTN's market presence. Telkom, currently valued at about $1.4 billion, is also seeking to engage experts for a potential new offer. The market is characterized by competition with companies like Vodacom, which has over 52 million subscribers, and Cell C with 7.7 million subscribers, creating a complex competitive environment.
Considering the potential implications of the proposed deal, MTN Group will focus on strengthening its position, but the future of the acquisition hinges on various factors, including antitrust approval.
