Telkom combined towers and real estate into a new unit called Gyro as part of restructuring two years ago.
Tuesday 28, May 2019
(Bloomberg) – South Africa’s Telkom is seeking an equity partner to help build more mobile-network towers as the former South African phone monopoly seeks new ways to increase revenue away from its core, fixed-line business.
Sipho Maseko, the Chief Executive Officer, the Pretoria-based company may also sell some of its 1,332 properties to raise cash for the project.
“We expect that with an equity partner and selling off some of the properties that are not core and that we are not using anymore we can scale our tower business quite quickly,” said Maseko.
The book value of the company’s property portfolio is between ZAR 10 billion ($691 million) and ZAR 12 billion, the Maseko added.
Telkom is looking to invest in high-growth businesses to offset the long-term sales decline at the fixed-line division.
Telecommunication towers are used by mobile-phone operators, including Telkom Mobile, to extend coverage and offer high-speed data services such as 4G and 5G. Telkom has about 6,500, with a plan to build 2,000 more over the next three years.
“With South Africa getting ready to roll out 5G there will be a lot more towers required, the Gyro team is well placed to capitalise on that,” Maseko said.