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While excitement is brewing over the imminent purchase and Telkom shares have rallied a bit, there’s no assurance the deal will fly at the end of the day, a reality that both sides have affirmed. Talks are still at an early stage, and nothing is assured. MTN is making the offer because it wants to strengthen its hold in the telecoms sector and has the financing to do so, having disposed of some of its assets in the past few years.
Still, whatever the two should decide on assuming Telkom will eventually go to MTN will face serious regulatory scrutiny. And only after the regulators approve would there actually be an acquisition.
An acquisition would be a major coup for MTN, which is seriously looking to strengthen its market within South Africa and across the African continent.