RealTime IT News

SBC Sells South African Telecom Stake

SBC Communications is selling its remaining stake in South African telecom provider Telkom SA Limited to a consortium of investors.

The deal flows through Thintana Communications, which is owned by SBC (60 percent) and Telekom Malaysia (40 percent). Under the agreement, Thintana will sell its remaining interest in Telkom SA.

In June, Thintana reduced its ownership in Telkom SA from 30 percent to 15.1 percent. SBC's portion of that sale was $543 million in cash, according to its most recent filing.

Financial terms of today's agreement between Thintana and a consortium of investors led by Andile Ngcaba and Women Investment Portfolio Holdings were not disclosed.

The proceeds will help defray costs associated with Cingular's $41 billion acquisition of AT&T Wireless , SBC spokesman Walt Sharp told internetnews.com. SBC co-owns Cingular along with BellSouth Communications .

Meanwhile, SBC, which cut 7,000 jobs over the past 12 months (mostly through attrition), expects even larger reductions next year, it revealed in a regulatory filing.

"We currently anticipate there will continue to be additional workforce reductions through attrition or involuntary programs that could exceed 10,000 by Dec. 31, 2005," the company said in a filing with the U.S. Securities and Exchange Commission.

SBC said the estimate, which would represent about 6 percent of its workforce, is based on "a number of initiatives to improve efficiencies." It did not say how much it would save as a result of the lower employment figure.

"We will attempt to use attrition to the maximum extent possible," Sharp said. "Cuts will be across all businesses and all geographies. It is possible that there will be some hiring in growing parts of the business and reductions in areas not growing as rapidly."

To offset losses in its traditional phone service, SBC is making heavy investments in fiber to deliver a triple play of high-speed data, voice and video.