The long-running saga of Multi-Links, Telkom’s disastrous Nigerian investment, may finally be drawing to a close. The JSE-listed fixed-line operator has signed an agreement to sell Multi-Links to an affiliate company of Helios Towers Nigeria.
This follows a Nigerian high court ruling in favour of Helios Towers, which operates base station infrastructure on behalf of operators, that prohibited Telkom from selling Multi-Links to Nigeria’s Visafone Communications.
The court’s ruling prompted Telkom CEO Nombulelo Moholi to announce at the group’s annual financial results presentation earlier this month that it would stop investing in Multi-Links until a resolution could be found.
In terms of a heads of agreement, which is subject to relevant approvals, the Helios Towers Nigeria affiliate will acquire full ownership and control of Multi-Links.
“The entire issued share capital of Multi-Links will be sold for a consideration of US$10m, which may increase depending on the achievement of certain conditions. Telkom will continue operational funding to Multi-Links to enable completion of the transaction,” Telkom says.
“Telkom will participate in a portion of any upside above a certain threshold in the case of a disposal of Multi-Links by an affiliate of Helios Towers Nigeria on or before three years of deal completion. The participation portion is dependent on the lapse of certain time periods.”
Telkom chairman Lazarus Zim describes the agreement as a “win-win transaction that will yield benefits to both sets of shareholders”.
“In addition, we believe that embarking on this path will be beneficial to all of Multi-Links’s stakeholders particularly, employees and customers in Nigeria,” Zim says. — Staff reporter, TechCentral