PARLIAMENT OF THE REPUBLIC OF SOUTH AFRICA
NATIONAL ASSEMBLY
WRITTEN REPLY
QUESTION NO: 566
DATE OF PUBLICATION: 25 February 2011
QUESTION PAPER NO: 03
DATE OF REPLY: 22 July 2011
Mrs J D Kilian (Cope) to ask the Minister of Communications:
(1) Whether the Government has taken any steps with regard to the
Nigerian operation (details furnished) that has resulted in write-offs
of approximately R5,2 billion for Telkom; if not, why not; if so, what
are the relevant details;
(2) when was the Government informed that Telkom bought the remaining 25%
of the said company for approximately $130 million in 2009;
(3) whether any reasons have been provided for the excessive costs paid
for the company that was using outdated technology and could not
compete in a highly competitive market such as the Nigerian
communications industry; if not, what is the position in this regard;
if so, what are the relevant details;
(4) what explanation did the Government as the peopleâs shareholder
receive from Telkomâs board about this failed transaction?
NW624E
REPLY:
1) As one of several shareholders in Telkom, Government raised its dismay
at the write-off of approximately R5, 2 billion in the Nigerian operation
at the Telkom AGM in 2010.
2) Government together with other Telkom shareholders were informed by the
way of SENS announcements and the Annual Report about the acquisition of
the remaining 25% equity in Multi-Links in 2009.
3) Telkom underestimated the highly competitive nature of the Nigerian
Telecommunications market and also failed to build and manage appropriate
distribution channels.
4) Telkom underestimated the highly competitive nature of the Nigerian
Telecommunications market and also failed to build and manage appropriate
distribution channels.