March 7 (Bloomberg) -- Telkom South Africa Ltd. rose the most in almost three years after KT Corp. said it’s still in talks to buy a stake in Africa’s biggest fixed-line phone company.
Telkom shares advanced 5.3 percent to close at 26.68 rand, the highest in more than two weeks and the biggest increase since July 2009.
“It’s going well,” KT Corp. Chairman Lee Suk Chae said in an interview at a conference in Seoul today.
The stock declined 2 percent on Feb. 29 when Absa Asset Management and MMI Asset Management said South Korea’s largest phone and Internet company may reduce its potential offer price for a 20 percent stake in Telkom or abandon the 3.8 billion-rand ($497 million) transaction. Telkom said on Oct. 14 it may sell new shares at 36.06 rand each to allow KT to acquire a stake in the company. The shares fell 21 percent from Oct. 14 to Feb. 29.
“We are getting more direction on the transaction,” Paul Chakaduka, a Johannesburg-based trader at Global Trader said by phone. “Getting government to loosen control would be ideal for Telkom and getting a suitor who has expertise, especially in data and mobile” would be beneficial, he said.
The South African government holds 39.8 percent of Telkom while a South African state pension fund manager, the Public Investment Corp., owns 10.9 percent, according to data compiled by Bloomberg.
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