Telkom, which is the subject of a takeover bid by rival MTN, has filed court papers aimed at blocking an investigation into its ill-fated operations in Nigeria and Mauritius more than a decade ago.
In January, President Cyril Ramaphosa ordered a probe of Telkom’s forays in the two countries, giving the Special Investigating Unit (SIU) wide scope to look into allegations of corruption and malfeasance in the company’s affairs dating as far back as 2006.
In court filings, seen by Business Day, the operator is asking the court to declare the SIU’s investigation “unconstitutional, invalid and of no force or effect.”
Telkom, of which the government owns about 40%, was on a downward spiral when it entered Nigeria in 2007 via the purchase of three-quarters of a $500m (R8.4bn in today’s money) mobile business called Multi-Links. The company racked up losses and was offloaded a few years later for just $10m.
Telkom’s deal in Mauritius came a year later when it merged Mweb Africa, acquired from Naspers for R624m, with Africa Online, a Kenyan-based firm it bought for R150m. It created a pan-African internet service provider called iWayAfrica, but the entity never gained traction and was sold in 2013 for an undisclosed amount.
Analysts estimate Telkom lost as much as R20bn on its investment in these businesses, which had been part of the group’s plan to expand into the rest of Africa.
Telkom has listed President Ramaphosa, communications minister Khumbudzo Ntshavheni and the SIU as part of the respondents in the case. This grouping has 15 days to respond on whether they will oppose the motion.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.