Goldleaf Trading says it intends to accept an invitation to negotiate directly with government for a stake in the second fixed-line telephone company due to take on Telkom this year.
To do so, it will abandon the legal challenge it had been preparing and vowing to press ahead with until recently.
"We are not going to court now that we have the new process," says consortium head Peter Archer. "This is much more what we are used to and we quite like what we see in front of us. We just wish we were in this position six months ago."
Communications minister Ivy Matsepe-Casaburri this week said she would launch a new process to select a foreign partner for the second national operator (SNO). Unlike the failed selection process, which saw both Goldleaf and competitor Optis Telecommunications dismissed as unsuitable, the new route is to see the minister take personal responsibility to find the right partner. Instead of a public process, negotiations with interested parties will take place behind closed doors. The government hopes to appoint a partner within three months.
Although details of the new process are still to be released, the minister specified that Goldleaf and Optis would be welcome to participate in the new process.
Goldleaf says it is much encouraged by the flexibility the new selection promises.
"[The previous] process was very fixed, very rigid," says Mike van den Bergh, who represents Gateway Communications in Goldleaf. "This is a far more pragmatic approach."
Goldleaf believes changes in the global telecommunications landscape and the local market sabotaged the initial selection process, which it says was based on outdated expectations. Now it hopes open negotiation will see a positive outcome.
The consortium is also confident of its chances to negotiate a stake in the eventual SNO, despite the fact that a number of interested parties are expected to make a play for it.
"This may be a new process but you still need to have done all the same work," says Van den Bergh, citing the research and due diligence done by Goldleaf over more than a year. "To now do it from scratch would be an interesting challenge given the minister`s timeframe," adds Archer.
The group does not expect to see what it terms old-style strategic equity partners, or foreign telecommunications operators, to show interest in the new process.
Goldleaf says it will show flexibility of its own in negotiations, and could be ready to accept a stake smaller than the 51% originally envisaged or to take on new partners suggested by the minister.
Related stories:
Goldleaf confident in legal challenge
Goldleaf goes to court to halt SNO process
SNO suitors rejected
Share