Telkom rival in operation 'soon'
20 September 2004
Telkom's monopoly on fixed-line telecommunications in South Africa is officially dead ... but not yet buried.
Communications Minister Ivy Matsepe-Casaburri granted a licence for a second national fixed-line operator on Friday, despite legal action by one of the parties to the consortium awarded the licence.
The consortium consists of black empowerment group Nexus Connexion, Transtel, Esitel, WIP Investments Nine (trading as Communitel), Two Telecom Consortium, and an as-yet unallocated shareholder.
Transtel and Esitel are the telecoms arms of transport parastatal Transnet and electricity utility Eskom respectively.
Newspapers reported on Friday that 19% stakeholder Nexus had served papers on the government on Thursday challenging the inclusion of the largely foreign-owned companies Communitel and Two Telecom Consortium.
However, Karl Socikwa, chairman of the second operator interim committee, told Business Day on Friday
that the bickering within the consortium would be settled out of court, and that a competitor to Telkom would quickly be launched.
Deputy Communications Minister Roy Padayachee echoed Socikwa, telling Business Day he had confirmation that Nexus would drop its legal action.
Matsepe-Casaburri said that a new company, SEPCo, would be incorporated and would hold 51% of the new operator's share capital, with Transtel and Esitel holding a combined 30% and Nexus the remaining 19%.
Control of SEPCo would be held by a new financial investor, which would have a 51% shareholding in SEPCo, the minister said, while Communitel and Two Telecom Consortium would each hold 24.5% of SEPCo.
The minister said the process of selecting a suitable investor for the unallocated 26% stake in the new operator would be finalised "soon".
She passed the task of approving the applicants' submissions, shareholders' agreement and business plan, and issuing the licence to the new
operator, to the Independent Communications Authority of SA.
Telkom welcomed the granting of a public switched telecommunications services licence to a second network operator as part of the "continued liberalisation of the market".
"We look forward to robust competition in the sector, which will create more choice and increased availability of infrastructure to the public", Telkom spokesperson Ravin Maharaj said.
SouthAfrica.info reporter
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