Rain pitches Telkom tie-up as alternative to MTN
South African internet provider Rain proposed a merger with larger rival Telkom to become a third major operator in the country, a challenge to a takeover proposal from MTN Group.
Six-year-old Rain, which offers 4G and 5G services, has made a formal request to pitch to Telkom’s board, according to a statement Thursday. The terms of such a transaction such as valuation and structure would still need to be agreed, the firm said.
Telkom shares gained 6.2% as of 3:10 p.m. in Johannesburg, valuing the company at R24 billion ($1.5 billion).
MTN announced talks to buy Telkom last month in a deal that would create the biggest South African mobile-phone operator by number of subscribers. The move faces antitrust hurdles, however, as it would create an effective duopoly.