Hon Speaker, state-controlled Telkom is haemorrhaging value, talented staff and investor confidence as Cabinet ponders its future. In the past week, Telkom's value has dropped by 5%. In the past year, its value has halved, gutting the investments of South Africans who once hoped they had a nest egg in the nation's giant fixed-line provider.
Five months ago Cabinet dashed these hopes when they rejected a R3 billion investment from KG Corporation, which came as a risk-free, internationally acclaimed management expertise injection and world-class skills development. One of the implausible reasons given for this decision was that government would never dilute its shareholding in Telkom to give KG Corporation the 20% share it was asking for.
Last month, Minister of Communications, Dina Pule, disrupted Telkom's AGM, crippling its board, and further eroding its share price. What can government's tactic be here? Perhaps the idea is to devalue ordinary South Africans' shares in the company, so they can be bought out at bargain basement prices by ANC-connected telecom's industry players.
Will anyone from the Cabinet who shares the responsibility for Telkom's fate tell us whether this is behind the Minister's bizarre behaviour; if not, what is the motive for Minister Pule's recklessness?