Rain chair Paul Harris wants to repeat the success they had when they merged RMB and First National Bank.
Leading entrepreneur Paul Harris , one of the triumvirate who created SA’s leading financial services group
Earlier this month Telkom confirmed it is ‘in play’ in a trading statement which referred to its ‘value unlock strategy, which was adopted following the realisation that Telkom’s market capitalisation is not representative of its intrinsic value.” The shares currently trade at two thirds of its stated net asset value of R66 a share.MTN had approachedWere the merger with rain to be consummated, the most obvious challenge would be a clash of cultures.
What about the very real issue that 80% of mergers fail — a point which former investment banker Harris is acutely aware of? His response: “We’re very aware of the merger stats and will not go into it without being comfortable with the risks.”Harris answered a series of my questions on Thursday morning via WhatsApp — his responses are in italics:
Telkom’s market cap is R23bn. With rain’s R1bn ebitda it is likely to be valued at not much more than half that figure. So would this not be more of a takeover by Telkom than a merger? Or have I got the numbers wrong?
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