South Africa’s Telkom says bigger rival MTN has terminated buyout talks

South African mobile operator Telkom (TKGJ.J) said on Wednesday that its bigger rival MTN Group (MTNJ.J) had terminated talks to buy the former in what would have created the country’s biggest telecoms company.

Telkom said it could not offer MTN assurances to enter into exclusive talks sought by the country’s second-biggest telecoms service provider.

MTN said in a separate statement that the companies were unable to reach an agreement on a deal.

In July, MTN offered to buy its smaller rival in a stock or cash-and-shares deal.

But a month later, data network provider rain, partly owned by South African billionaire Patrice Motsepe, proposed a merger with Telkom. It withdrew the offer later only to come back last month with a revised offer asking Telkom to buy it out.

“MTN terminated discussions… as Telkom was not in a position to provide MTN with assurances around exclusivity,” Telkom said in a statement.

The talks between Telkom and MTN were at an early stage and had not progressed to due diligence, Telkom said, adding that it had not received any binding offer from MTN.