Competition Tribunal approves BCX‚ Telkom merger

The Competition Tribunal of South Africa on Thursday approved the proposed merger between Business Connexion Group Limited (BCX) and Telkom.

Since April 2013‚ Telkom had embarked on a strategy to improve performance and one of the key considerations in respect of this strategy was to grow beyond its core business of connectivity by expanding into ICT services‚ a statement said.

Telkom had consolidated operating revenue from continuing operations of R31.7-billion and profit after tax from continuing operations of R2‚889-million for the year ended March 31. The group generated free cash flow of R3.9-billion during the same period.

BCX is one of the largest ICT services providers listed on the JSE when measured in terms of turnover‚ total assets and staff compliment. The company employs more than 6‚700 people on the African continent with offices in various African countries‚ the UK and Dubai and generates revenue in excess of R6-billion per annum.

“BCX has very strong capabilities in managed IT Infrastructure‚ including data centres‚ cloud based services and application development and the merger will enable Telkom to expand its existing offerings whilst‚ at the same time‚ providing scale in IT services‚ which will help reinforce Telkom’s core connectivity business and enhance Telkom’s convergence strategy”‚ said Isaac Mophatlane‚ BCX CEO.

Commenting on the way forward‚ Mophatlane said he believed that the merger would advance the strategies of both Telkom and BCX and that working together with Telkom would improve both their customer value propositions through a greater ability to provide integrated end-to-end ICT solutions and a more global and competitive offering‚ particularly on the African continent and beyond.

Final approval will now be sought from the Takeover Regulations Panel and the JSE.

Mophatlane said BCX expected the transaction to be concluded by August 25.

RDM News Wire.