Cell C: Roaming deal a key part of turnaround, and Telkom one of many to approach us

Cell C: Roaming deal a key part of turnaround, and Telkom one of many to approach us

MTN and Cell C likely considered their new roaming deal in the context of Telkom's bid to take over Cell C, Telkom has said. 

The telecommunications company responded to a query from Fin24 via email, on its reaction to the latest announcement that Cell C and MTN have entered into a new roaming agreement. The deal would allow for Cell C to roam on MTN's network across the country.

The announcement was made just days after Telkom issued a notice to shareholders indicating it is in discussions to buy Cell C.

Focus on turnaround

"Telkom notes the decision between Cell C and MTN to conclude a roaming agreement which remains subject to conditions," Telkom said.

"We expect that the parties involved would have considered the roaming agreement and its terms in the context of the discussions with Telkom."

"Telkom's potential acquisition of Cell C will be subject to Cell C completing a financial restructuring to ensure that its gearing levels are reduced to a sustainable level as specified by Telkom and commercial contractual relationships are renegotiated to terms acceptable to Telkom," the group added. 

Responding to a query from Fin24 about how the new deal with MTN might impact Telkom's bid to buy it, Cell C said that while its board is continuously approached by various parties it remains focused on executing its turnaround strategy.

Earlier on Monday, Cell C CEO Craigie Stevenson said that the agreement is a "pivotal step" in the mobile operator's turnaround strategy.

"One of the key pillars of this turnaround is to implement a revised network strategy that enables Cell C to manage its network capacity requirements in a more cost efficient and scalable manner," he said.

"This roaming agreement is transformative for Cell C. The company is no longer encumbered by the high costs of building a network footprint and we can focus our energy and efforts into developing innovative and disruptive service offerings that will be welcomed by data hungry consumers.

"This is a win-win all round as it has long term benefits for the economy, the industry and ultimately consumers," Stevenson said.

The board is continuously approached by various parties and we remain focused on executing our turnaround strategy."