Johannesburg - A dispute dating back to Telkom’s failed Nigerian telecoms venture Multi-Links has been settled.
Telkom bought 75% of code division multiple access (CDMA) operator Multi-Links in 2007 for $280m. Almost two years later, the South African telecoms company then bought out the balance for another $130m.
Multi-Links, though, proved to be a loss-making failure, and Telkom sold the company in October 2011.
During Telkom’s brief venture in Nigeria, an agreement was signed with Blue Label subsidiary Africa Prepaid Services Nigeria (APSN) to distribute Multi-Links’ products and services in the West African country.
But after Multi-Links’ failure in Nigeria, the Blue Label subsidiary claimed an amount of $457m following the termination of the deal. And in June 2011, APSN launched arbitration proceedings against Multi-Links
Telkom and Multi-Links then obtained a stay of the arbitration proceedings and launched legal action against Blue Label and Africa Prepaid Services, which is the holding company of APSN.
This was followed by Multi-Links then counter-claiming to the tune of $123m.
This arbitration also targeted individuals, such as Mthunzi Mdwaba and Thami Msimango, for payment of $528m and $196m respectively.
Africa Prepaid Services subsequently counterclaimed against Telkom and Multi-Links for $457m.
But the dispute is now water under the bridge, according to Telkom.
“The arbitration proceedings between a Blue Label subsidiary, Africa Prepaid Services Nigeria Limited (‘APSN’) and the former subsidiary of Telkom, Multi-Links Telecommunications Limited (‘Multi-Links’) has been settled,” Telkom told shareholders in a Sens announcement.
“The litigation action in the High Court of South Africa between Telkom and Multi-Links, on the one hand, and Blue Label, Africa Prepaid Services (Pty) Ltd, APSN and certain individuals, on the other, has been settled,” read the Sens announcement.
“In terms of the Settlement Agreement all claims and counterclaims have been withdrawn and all of the parties have agreed that they will have no further claims against one another arising out of the disputes forming the subject of both the arbitration proceedings and the action, including any claims for costs,” noted the statement.