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Telkom, MTN close to network pact

Johannesburg - Telkom, Africa’s largest landline provider, is nearing an agreement with MTN to share the companies’ mobile phone networks, according to two people familiar with the matter.

A deal between the two South African carriers would help Telkom reduce the cost of its wireless business while giving MTN, the continent’s largest mobile operator, access to some of Telkom’s spectrum, said one of the people, asking not to be named because the deliberations are confidential.

Telkom CEO Sipho Maseko. File picture: Masi Losi. Credit: INDEPENDENT MEDIA

An agreement may be announced as early as this week, the person said.

Telkom is in discussions with “various parties” about Telkom Mobile, Pretoria-based Telkom said in an e-mailed response to questions.

MTN has been reducing its network of towers by selling and then leasing them in Rwanda, Zambia, Cameroon and Ivory Coast as it cuts operational expenditure.

Telkom paid 1.1 billion rand to other mobile network operators in the six months through September, compared with 1.48 billion rand a year earlier.

Telkom, which has had five leaders since 2007, is struggling to revive revenue among consumers in a country that has leapfrogged fixed-line technology in favour of smartphone devices that are driving a boom in data usage across Africa.

The company is trying to lower expenses, especially in its mobile business, which chief executive Sipho Maseko said he wants to reduce by at least 50 percent. - Bloomberg News

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