EDITORIAL: Regulators escape test case as MTN ditches Telkom deal
It opened the door for Rain to pursue a merger with Telkom
MTN’s decision to walk away from a tie-up proposal with Telkom last week did more than just crush the latter shareholders’ hopes of a big payout. It piled pressure on Serame Taukobong, who entered the CEO suite at Telkom earlier this year, to step up his share price boosting initiatives and opened the door wide for Rain, the fast-growing data-focused mobile network operator, to pursue a merger with Telkom.
Most importantly, MTN’s move is an anticlimax to what had been set to be a test case for whether SA competition authorities — alive to the reality that smaller players buried in debt invariably run into financial trouble when they try break into the upper echelon of the industry — would be sympathetic to deals that cut the number of mobile operators ..
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