Johannesburg - Telkom plans to break out its
telecommunications towers and real estate assets into a separate unit that may
then be listed on a stock market, according to two people familiar with the
matter.
The new entity would be run by a new, property-focused
management team charged with generating extra revenue for Africa’s biggest
landline provider, said the people, who asked not to be identified because the
plans are private.
Pretoria-based Telkom has one of the largest real estate
portfolios in South Africa and CEO Sipho Maseko wants it to contribute more to
earnings, they said.
The move extends a turnaround strategy at the former
phone monopoly under Maseko, who has cut costs and helped to engineer a near
quadrupling of the stock price in his four years at the helm.
Read also: Telkom sets sights on Cell C's debt
The workforce has been reduced by about half to 12 000
people and the wireless unit is now profitable.
The creation of the property business is part of the next
phase of Maseko’s strategy, which will involve an examination of each of the
company’s operations, said one of the people.
The shares rose 0.9 percent to R73.68 as of 12:34 p.m. in
Johannesburg on Monday, valuing the company at R38.8 billion.
The business is about 39 percent owned by the South
African government.