Chinese group buys Telkom Media
May 6, 2009
Johannesburg - Telkom's media unit has been sold to Shenzhen Media, Telkom SA said on Wednesday.
"Telkom has managed to avert the winding up of Telkom Media by selling its 75 percent interest in and claims against Telkom Media to Shenzhen Media for a nominal amount," Telkom said in a statement.
Last year, on March 31, Telkom announced its decision to significantly reduce its investment in Telkom Media.
"Subsequently, various expressions of interest were considered, some of which led to further negotiations with interested parties in a process to find a new majority shareholder for Telkom Media," the statement said.
However, the process was unsuccessful and on March 25, 2009 Telkom announced that a Telkom Media shareholders' meeting had been called to approve the winding up of Telkom Media.
On April 16, Telkom Media's shareholders unanimously voted in favour of a special resolution to wind up Telkom Media.
"In a final attempt to prevent the winding-up of Telkom Media, Telkom launched an accelerated sale process for Telkom Media shareholder's equity and loan accounts.
"In terms of this process, Telkom was only prepared to consider unconditional offers backed with adequate financial guarantees', the statement said.
According to Naas Fourie, Telkom's chief of strategy, an invitation was sent to parties who, in one way or the other, had expressed an interest in Telkom Media.
The accelerated process resulted in a share sale agreement being signed with Shenzhen on April 29, in terms of which Telkom disposed of its shareholding and loan account in Telkom Media on a "voetstoots" basis, he said.
The transaction closed on May 4.
"There were no conditions precedent included in the share sale agreement which enabled the quick conclusion of the deal," Fourie said.
Shenzhen agreed to procure Telkom Media and to change its name within 30 days of closing.
Regarding the future plans of Telkom Media, Fourie stated that "decisions relating to Telkom Media's future operations will now be in the hands of Shenzhen as the new majority shareholder". - Sapa
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