Data-only network provider Rain has been forced to withdraw its media announcement of a plan to merge with Telkom after the move was condemned by the Takeover Regulation Panel (TRP) as unlawful, reports Fin24.

Last Thursday Rain released a press release, announcing a proposal to merge with Telkom.

But the TRP said the media announcement was issued without its approval, as required by law.

It demanded that Rain withdraw the announcement. In response, Rain said it would get a legal opinion.

Yesterday, Rain withdrew its press release, but said it would submit a formal proposal to Telkom in due course.

‘As Rain we are pleased with Telkom’s SENS (Stock Exchange News Service) announcement stating that if an offer or formal proposal is received from Rain, the board of Telkom will consider it,’ the company said in a statement.

Last week, Rain said the merger would create a ‘5G powerhouse’, a strong third player to compete against a ‘telecommunication duopoly’ in SA.

But it is competing with MTN, which wants to buy Telkom, as well as black-owned investment firm Toto Consortium, which wants to acquire government's 40.5% stake in Telkom for around R7bn.

Full Fin24 report