The Competition Commission wants Telkom to cut the cost of IPConnect
Telkom has suspended its dividend policy for the next three years as it seeks to build its cash position ahead of a planned auction of radio frequency spectrum in South Africa.
“Telkom indicated in the first half of the year that it will review the dividend policy and, in considering the new dividend policy, Telkom will prioritise its capital investment programme, maintain a healthy balance sheet and consider its cash position within its capital allocation framework,” it said.
The imminent spectrum auction will require a substantial amount of capital and it is of strategic importance for Telkom to participate
“The imminent spectrum auction will require a substantial amount of capital and it is of strategic importance for Telkom to participate to ensure the sustainability of the mobile business.
“Given all these factors that are expected to impact Telkom, the board found it prudent to suspend the dividend policy for the next three years from the 2021 financial year.
Over the next three years, the capital will be redirected to the acquisition of spectrum and to complete the key capex programme to ensure the sustainability of our business.”
