JOHANNESBURG, June 1 (Reuters) – South African stocks fell
slightly on Friday as investors sold off shares in fixed-line
operator Telkom after the government said it would not
back its partnership with South Korean KT Corp.
Stocks were also swept up in an investor stampede to cash
and secure government bonds after U.S. jobs data pointed to
slower growth in the world’s largest economy.
The benchmark JSE Top-40 index fell 0.14 percent to
29,161.0 and the broader All-share index was 0.11
percent lower to 33,107.46.
Shares in Telkom dropped 8.34 percent to 21 rand – hitting
an eight-year low in the session.
The move was prompted by its largest shareholder, the South
African government, rejecting a deal seen as a lifeline for
Telkom’s ailing fortunes hit by the decline in traditional
telephone usage and failed expansion in Nigeria.
South Korea’s No. 2 mobile operator last month cut its offer
for a 20 percent stake in Telkom by nearly a third, bringing the
total sale value down to about 3.3 billion rand ($385.5
million).
“With the reduced price, the government feels that selling
Telkom at this price would be a give away,” said Dobek Pater, a
telecoms analyst at consultancy Africa Analysis.
Pater said the government may be betting on Telkom’s
performance to improve, which would then boost the sale price.
The Telkom woes helped spur a broader market sell off made
worse by more signs of stuttering global growth.
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