Telkom SA has received a preliminary offer for its stake in South Africa's largest mobile phone company as well as a takeover approach from a consortium led by freedom fighter-turned-business tycoon Tokyo Sexwale.

Pretoria-based Telkom, Africa's largest fixed-line network operator, Monday said a consortium including Sexwale's Mvelaphanda Holdings is interested in buying the company, less its 50% stake in Vodacom Group. It also has received a non-binding offer from Britain's Vodafone Group for some of its stake in Vodacom, it said.

If the offers were taken in tandem, analysts said, Vodafone would likely buy control of Vodacom, with the remainder of Telkom's interest in the mobile venture spun off to its shareholders, and the Mvela consortium would buy the rump fixed-line business.

Analysts speculate the sale could value Telkom at as much as $15 billion, depending on how the deal was structured, with the bulk of the company's value stemming from Vodacom, which has driven its earnings and sales. News of the approaches spurred a rally in Telkom's shares, pushing its market value to almost $11 billion at one point Monday.

A sale would bring in new owners for the former monopoly's fixed-line business, at a time when South Africa's telecommunications industry faces a massive shakeup. It also stands to further Vodafone's ambitions of increasing its footfall in faster-growing emerging markets.

Mobile phone penetration remains low in much of Africa, which has spurred increased interest in the region. India's Bharti Airtel last month broke off merger talks with MTN Group, Africa's largest mobile operator, but talks were quickly resumed with smaller Reliance Communications about a possible tie-up that would create an emerging-markets focused mobile giant.

Telkom in a statement said it last Friday received an offer from a unit of Vodafone to buy a portion of its 50% interest in Vodacom, subject to the South African company spinning off its remaining stake in the mobile operator to its shareholders.

A person familiar with the matter said that Vodafone is interested in an additional 12.5% stake in Vodacom, which would give it control with a total 62.5% interest.

Rajay Ambekar, a portfolio manager at Cadiz African Harvest Asset Management, said that although details are thin, it is likely Vodacom would ultimately be listed, with Vodafone the majority shareholder.

This would allow the South African business to maintain a black shareholder base in the country, fulfilling a tenant of the government's push to bring people disadvantaged under the former apartheid regime into the mainstream economy.

Telkom said it separately received a letter Friday from a consortium of Sexwale's Mvela Holdings, New York-listed Och-Ziff Capital Management and other strategic backers interested in making an offer for all of Telkom, conditional on it spinning off its entire stake in Vodacom.

"The board of Telkom, in accordance with its fiduciary duties, will evaluate all bona fide offers with a view to maximizing shareholder value," the company said. "No transaction will be entered into without requisite shareholder approvals."

Mvela was founded by in 1998 by Mosima "Tokyo" Sexwale, a former African National Congress activist, political prisoner and populist politician who at one time was tipped to be South Africa's next president.

Cadiz's Ambekar said neither Sexwale or Mvela have any significant telecoms experience, so likely view ownership of Telkom as an opportunistic investment. That likely means they wouldn't plan wholesale changes to the company's structure or management, he said.

A spokesman for Mvela wasn't immediately available to comment, and both Telkom and Vodafone wouldn't comment on the possible structure or price of any transaction.

 Any deal to buy Telkom or its stake in Vodacom would depend greatly on government approval.

The state is the largest shareholder, with a 38.9% stake. Government-owned Public Investment Corp. holds a 15.3% stake and the Elephant Consortium, which has links to the ruling African National Congress, owns a further 5.7%.

Analysts said it is possible the Mvela consortium has the tacit support of the government for a takeover, which would make a takeover likely to succeed. That the consortium doesn't seem to want to keep Telkom's stake in Vodacom should also make a deal easier, although it may mean Telkom would later need to launch its own mobile service, possibly piggy-backing on another operator, one analyst said.

PIC declined to comment, saying only that it was at this point a "Telkom issue."

Telkom has been reviewing its mobile operations for more than a year, and at varying times has said it would be open to disposal, takeover or joint venture.

It last November said it had broken off talks to sell its fixed-line operations to MTN and an interest in Vodacom to partner Vodafone. In January, Telkom said it had received a non-binding offer from Dubai-based Oger Telecom Ltd., which has a 75% interest in Cell C, South Africa's third-largest mobile operator behind Vodacom and MTN.

Vodafone, meanwhile, has repeatedly said it is interested in gaining control of Vodacom, and people familiar with its strategy say it has been frustrated by its relationship with Telkom and its slow expansion into the rest of Africa.

John Davies, an analyst at Dresdner Kleinwort, said a bid by Vodafone for a further 12.5% in Vodacom could be worth between about $2 billion and $3 billion.

Vodacom had 34 million customers at the end of March, mainly in South Africa, although also in Lesotho, Mozambique, Tanzania and the Democratic Republic of Congo. MTN, in contrast, had 68.2 million subscribers.

Telkom's fixed-line business, meanwhile, is under threat from fixed-line newcomer Neotel, run by Indian conglomerate Tata Group, as well as stiff competition from mobile phones.

It has responded with acquisitions such as Internet service provider Africa Online Ltd. early last year. However, Vodacom remains the driver of its growth.

At 1438 GMT, Telkom's shares were trading up 8% at ZAR148, while in London Vodafone was down 1.75 pence or 1. 1% at 160.5 pence.

Source: Dow Jones Newswires