Pretoria - The Communication Workers' Union (CWU) has saluted the
Cabinet's decision against a possible transaction between Telkom and
South Korean company KT Corporation.
The "financial mess" at the parastatal would not be
resolved by a cash injection from the Asians, CWU spokesman Matankana
Mothapo said on Monday.
"South Africans have more than enough talent to manage
their assets. In addition, we do not have to mortgage our country in
return for management expertise," he said.
"The scale of the financial mess that management has
plunged Telkom in will not be resolved by getting money injected by
Koreans," he said.
The government decided not to back Telkom's proposed partnership with the South Korean firm in May.
The deal would have given KT Corp a strategic equity
shareholding of 20% in the post-issue ordinary share capital of
The union called on Communications Minister Dina Pule to "review" the management of Telkom.
Meanwhile, Telkom said it accepted Cabinet's decision.
"Telkom will work with government to look at
alternative solutions for the company," Telkom Group spokesman Pynee
Chetty said in a statement.
"Telkom has communicated as such to all its shareholders."
Mothapo said Telkom management had "agitated" for the
Koreans to buy a stake in the struggling parastatal, hoping the deal
would turn around Telkom's fortunes.
"They were of the view that the Koreans will turn
Telkom around by coming in with management expertise and would bring
money to facilitate Telkom's investment programmes."
When the deal was announced in October, the CWU and
Congress of SA Trade Unions said it could lead to job losses and worse
service for the poor.
Telkom listed on the Johannesburg Stock Exchange in 2003.
The government is Telkom's majority shareholder with
39.8% of the shares, while the Public Investment Corporation
holds a 10.9% stake, according to Telkom's website.