Telkom to spin off towers business in separate listing

In an effort to unlock shareholder value trapped in its corporate structure, Telkom has announced it will seek a JSE listing for its masts and towers business.

The telecommunications group, which is about 40% owned by government, confirmed in a statement to shareholders on Tuesday that will seek a separate listing for Swiftnet, the masts and towers business held by subsidiary Gyro.

Telkom has 6 225 towers across South Africa and is “South Africa’s larges independently run tower portfolio”, the company said.

“Under the management of Gyro, Swiftnet has diversified its tenancy with 56% of its tenants coming from the industry,” said Telkom CEO Sipho Maseko. “The current Telkom valuation is not a true reflection of its intrinsic value. The value of the Swiftnet business is currently not being recognised.

“A separate listing of Swiftnet will affirm the valuation of the masts and towers business and its contribution to the overall valuation of the Telkom business, thereby unlocking further value for Telkom,” Maseko said.

The Telkom board expects to make a final determination regarding a separate listing before the end of the financial year.

Telkom’s share price rallied on the news, gaining more than 10% after shareholders were told about the plan. – © 2021 NewsCentral Media