Telkom Gets Ex-Vodacom South Africa Head Sipho Maseko as CEO
Telkom South Africa Ltd. has named Sipho Maseko, the former chief operating officer of Vodacom Group Ltd. (VOD), its new chief executive officer as the company looks for new growth amid increased competition in South Africa.
Maseko will start work on April 1, the Pretoria, South Africa-based company said in a statement. Telkom, the continent’s biggest fixed-line operator, also named Brian Armstrong, the head of its business unit, as chief operating officer to replace the departing Nombulelo Moholi.
Maseko left Vodacom, which is controlled by Newbury, U.K.- based Vodafone Group Plc (VOD) and is the biggest wireless company in South Africa, last June. His challenge will be to turn around Telkom’s business in its home country, which has contributed to three consecutive years of declining revenue. The company must also find the resources to fulfill a mandate to roll out broadband infrastructure to all citizens by 2019.
Shares in Telkom rose almost 4 percent to 14.75 rand by 2:46 p.m. in Johannesburg, paring 2013 declines to 12 percent. The company, almost 40 percent owned by the South African government, is valued at around 7.7 billion rand ($760 million).
“It’s interesting because it’s an appointment from a cellular environment and fixed line is a very tricky business to get right,” Bruce Main, a fund manager at Ivy Asset Management Ltd, said by phone. “The new CEO has got a long road to walk. It’s a very tough environment.”
Telkom’s fixed-line traffic, measured in millions of minutes, dropped 70 percent from September 2003 to September 2011, according to Bloomberg calculations from Telkom earnings statements, while the number of fixed lines declined 15 percent.
Vodacom and MTN Group Ltd. (MTN), the nation’s largest mobile- phone operators, were in 2011 growing data revenue three times faster than Telkom, which in 2010 started its 8ta mobile-phone unit.