Telkom tripped by legal rulings

It was not a great week for Telkom. Last Friday's pronouncement by the Competition Commission that its proposed takeover of Business Connexion should be stopped, was followed by a Supreme Court of Appeal overturn-ruling against the fixed-line operator.

ITWeb reported on Monday that Telkom remained confident the BCX deal would go through - believing the Competition Tribunal would take a different stance to the commission. The deal does, however, seem more unlikely now that it did before.

But it was Wednesday's judgment by the Supreme Court of Appeal that really rocked the Telkom boat. Having been embroiled in a legal conflict with a former business partner, the US-based IT firm Telcordia, for five years, Telkom was dealt a final, and extremely harsh blow by the verdict. It is likely the SA telco will be forced to pay up to R1.5 billion, depending on arbitration outcomes.

Also hitting the headlines on Monday was the suspension (with full pay) of the SA Post Office CEO Khutso Mampeule. It's the most recent step in a slowly-unravelling story of corruption and mismanagement at the Post Office, inextricably linked to the scandals surrounding Maanda Manyaatshe - who recently stepped down as MTN's South African MD - when he was in Mampeule's office.

Virgin Mobile CEO Sajeed Sacranie was told to go work in a far more obscure part of the organisation this week.

Dave Glazier, journalist, ITWeb

Obviously it's a bad time of year for our cellular leaders, as Virgin Mobile CEO Sajeed Sacranie was told to go work in a far more obscure part of the organisation this week.

Peter Boyd, VP of marketing at Virgin Mobile USA, will take over as boss. Since Virgin's big mobile phone entry into SA has been nothing better than feeble (with a reported 30 000 subscribers only), I think we should wish Boyd the best of luck.

However, for something more positive in the cellular space one needs to look no further than cellphone banking. A planned cellular push, by the four big banks, is expected to yield a total of R650 million in combined transactions over the festive season. It's an interesting space to watch, and to be honest, the concept does have many advantages.

JSE-listed electronics and electrical engineering group Reunert this week sold almost a 10^th of the company to empowerment groups. Reunert announced the R1.1 billion BEE deal at its results presentation on Monday, which sees 30% of the empowerment stake being sold to Peotona Group Holdings and 70% of the stake to a broad-based BEE educational trust.

Second national operator Neotel is in discussions with its shareholders over a restructuring plan, saying it has been examining capital-raising options that include debt and equity funding, but it seems to have ruled out a bond issue for the time being. It will need to find a way to finance its estimated R11 billion, 10-year, expenditure plans.

Cape Town's executive mayor, Helen Zille, gave approval this week for the city to lay a broadband network, which will be built on an open infrastructure model, and aims to give equal access to its services for all.

It's a pretty big project, with an estimated total budget of R400 million - 80% of which will be spent on laying fibre optic cables.