Telkom South Africa Sells Subsidiary Companies
Published on: 24th Dec 2013
By: Ian Mansfield
South Africa's dominant landline operator Telkom has sold its Pan African business iWayAfrica and Africa Online Mauritius through a private sale to Gondwana International Networks.
Financial terms were not disclosed.
iWayAfrica was formed as the result of the amalgamation of MWEB Africa and Africa Online in 2007 when MWEB Africa was purchased by Telkom.
Telkom's Group Chief Executive Officer, Mr Sipho Maseko, said, "This transaction is one of many initiatives that will contribute to our own turnaround, allowing us to focus on our core South African fixed-line and mobile operations. We are also pursuing several other initiatives in a coordinated manner to restore Telkom's financial health."
Maseko said that Telkom has struggled to drive growth and profitability in the iWayAfrica business since it was acquired.
"Several years of poor performance of the iWay Group has resulted in continued negative EBITDA contribution to our Group."
The iWayAfrica business operates in eight countries on the continent offering terrestrial wireless and VSAT services to business and residential markets as well as via its channel partners in many other countries on the continent.
Maseko said, "It is important to note that Telkom's investment in iWayAfrica was already fully impaired during the 2012 financial year and a sale at this time made perfect sense.
"We have spent the year concentrating our efforts on stabilising our South African business and our focus now is on reviving Telkom SA's full performance potential," he concluded.