Government regains controlling share of Telkom

The Public Investment Corporation (PIC) has increased its stake in Telkom, with the government as a whole regaining a controlling share of the company.

Telkom alerted shareholders to the change in beneficial ownership of its shares on Thursday (10 July), noting that the PIC had acquired additional company securities.

The PIC’s total interest in the ordinary shares of Telkom, held on behalf of its clients, now amounts to 10.25%.

The South African government directly owns 40.51% of Telkom, with the Department of Communications and Digital Technologies serving as the group’s shareholder representative.

Including the PIC’s share, the state now has a representative 50.76% stake in the group—a majority shareholding.

Although the PIC shareholding technically belongs to its beneficiaries, the state-run fund holds the proxy voting rights on those shares.

This marks a peculiar turn in the state’s interest in Telkom, after it gave up its majority shareholding in 2024.

The PIC reduced its share in Telkom over the past year from the 15.89% held in March 2024, surrendering the state’s controlling stake in August that year.

At the time of Telkom’s most recent financial results, the PIC’s shareholding was even smaller at 7.45%, giving the state a total share of 48%.

Despite no longer being majority owned by the state at the time, Telkom retained its title as Telkom SA SOC Limited, with the “SOC” standing for State-Owned Company.

Another interesting note around the state’s shareholding is that it appears to be buying back into the company at a significant loss.

Given the group’s strong performance over the past year, its share price has increased significantly, jumping more than 60% from R33.58 at the start of the year to R55.18 during trade on Thursday.

Notably, the PIC sold its shares in Telkom when they were trading at R24 a share in August 2024. The share price has since more than doubled, costing the PIC more than double to buy back in.

The PIC also lost out on a bigger dividend payout.

The PIC’s 2024 sale came just before Telkom announced a massive performance improvement, with the group hitting R7.5 billion in profit in 2025.

The group started paying dividends again, and even declared a special dividend following the sale of its tower business, Swiftnet, for R6.5 billion.

The group had suspended dividend payments for three years in 2020 to conserve cash and buy much-needed spectrum, but took another two years to return cash to shareholders.