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19 January 2009

Telkom Media Statement

Telkom, once again, finds it necessary to clarify matters raised in two reports by a Sunday newspaper. Pursuant to the same publication's initial article in early December 2008 (which were clarified and corrected at the time), further unfounded allegations and inaccuracies in respect of a Telkom tender for the provision of a critical system to supply end-to-end solutions for point-to-point split mount radio equipment, have again surfaced.

Telkom, once again, refutes the insinuation that any close business relationship exists between its CEO and management at Ericsson and that this could have influenced the outcome of the tender.

Furthermore, the Company is in constant consultation with organised labour and, with regard to the allegation that the Communication Worker's Union (CWU) has called "for a probe into alleged corruption", the agreement with CWU is that Telkom would manage this issue internally. The Company's CEO has taken the initiative to ensure due process and compliance to all governance matters. KPMG has been appointed to investigate internal processes.

Telkom also confirms that a court application was received from the unsuccessful bidder, Maredi Telecommunications and Broadcasting (Pty) Ltd, to review and set aside the awarding of the tender.

Telkom re-iterates that its tender processes are extremely stringent and that the Company boasts a proud record of compliance to King 2 and Sarbanes-Oxley governance procedures.

To ensure the continuation of compliance with governance procedures as well as fairness and transparency with regard to current and future tender processes, Telkom's CEO (and not the Board) has appointed KPMG to independently audit certain aspects of the Company's procurement processes.

With regard to the sale of part of Telkom's stake in Telkom Media, the Company will be able to make a final announcement in this regard by the end of this month.

For further enquiries, please contact:

Pynee Chetty

Senior Specialist: Media Relations

Group Communication

Tel:+27 12 642 1716

Mobile: +27 81 389 7874

Email: chettpr2@telkom.co.za

OR

Leigh-Ann Francis

Specialist: Media Relations

Group Communication

Tel: +27 12 642 1728

Mobile: +27 81 391 4780

Email: francilm@telkom.co.za

Telkom Park, The Apex

92 Oak Avenue

Technopark

Highveld

Centurion

ABOUT TELKOM:

Telkom is a leading communications services provider in South Africa. We had consolidated operating revenue of R16.8 billion and normalised profit after tax of R1, 683 million for the period ended 30 September 2015. Total assets amounted to R41.9 billion and equity attributable to the owners of Telkom to R23.5 billion as of 30 September 2015. The group generated normalised free cash flow of R1.4 billion for the period ended 30 September 2015.

As of 30 September 2015, we had approximately 3.3 million telephone access lines in service and 1,030,441 ports connected via MSAN access. We offer business, residential and payphone customers a wide range of services and products, including:

  • fixed-line retail voice services using PSTN (Public Switched Telephone Network) lines, including ISDN (Integrated Services Digital Network) lines, and the sale of subscription based value-added voice services and calling plans;
  • fixed-line customer premises equipment rental and sales services both voice and data needs and these include PABX, Computers, Routers, Modems, Telephone handsets and other ancillary equipment;
  • interconnection services, including terminating and transiting traffic from South African mobile operators, as well as from international operators and transiting traffic from mobile to international destinations;
  • fixed-line data services, including domestic and international data transmission services, such as point-to-point leased lines, ADSL (Asymmetrical Digital Subscriber Line) services, packet-based services, managed data networking services and internet access and related information technology services;
  • Data Centre Operations includes e-commerce, application service provider, hosting, data storage, e-mail and security services;
  • W-CDMA (Wideband Code Division Multiple Access), a 3G next generation network, including fixed voice services, data services and nomadic voice services;
  • mobile communication services, including voice services, data services and handset sales through our mobile navbar-brand called Telkom Mobile;
  •  information and communication services including cloud services, infrastructure services, workspace services, global service integration management and hardware and network equipment sales locally, in seven African countries, the UK and Dubai through Business Connexion Group; and
  • other services including directory services, through Trudon (Pty) Ltd, wireless data services, through Swiftnet (Pty) Ltd.

Convergence is one of our key strategic initiatives in building a sustainable future for Telkom.  We will lead the provision of converged services in South Africa in support of our mission statement: Seamlessly connecting people to a better life.