Embattled mobile operator Cell C has rejected JSE-listed Telkom’s nonbinding acquisition proposal.
In an update to shareholders on Friday, Telkom said it had lifted its cautionary regarding the proposed acquisition after it had received a written notice from the Cell C board of directors.
“The Telkom board continues to believe the offer is a compelling proposition that would have created significant value for all stakeholders, including Telkom's shareholders,” it said.
Earlier in November, the telecommunications group confirmed that it was in discussions to buy out Cell C and had substantially concluded its due diligence.
A week later, telecommunications giant MTN and Cell C concluded an expanded roaming agreement that will extend Cell C’s coverage nationwide, with a 36-month implementation plan set to start early in 2020.
According to Cell C, the agreement marked a pivotal step in its turnaround strategy.
Cell C has been reporting incremental improvements to its bottom line as the operational efficiencies start to have a positive impact on the financial performance of the company.
Cell C had posted a net loss of R8-billion for the financial year to May 31. This had included R6.2-billion in noncash impairments.
It is also heavily indebted, with 45% shareholder Blue Label Telecoms having come under fire from its shareholders this year for having bought an interest in the mobile operator.