Telkom SA is mulling a bid of $1 billion for South Africa’s smallest operator, Cell C, in the event the latter’s deal with Blue Label Telecoms doesn’t go through, Bloomberg reported.

Investment banks are approaching other potential bidders, including Telkom, to take on the deal. Blue Label agreed to buy a 45 per cent stake in Cell C last year, but the deal remains incomplete as an end-February deadline for its conclusion looms.

Blue Label said it would invest ZAR4 billion ($305 million) of new capital in Cell C, while the company’s controlling shareholder Oger Telecom would reduce its stake to around 25 per cent.

Both companies said they expected the deal to close by 1 June 2016.

In August, Blue Label joint CEO Mark Levy insisted the deal was “on track”.

Cut to February 2017, and Cell C company representative Karin Fourie said: “The Cell C recapitalisation remains on track and is supported by the equity investors as well as the existing lenders to the business. All lenders have expressed their support for this process, which remains ongoing.”

There are some complications surrounding the deal. Cell C’s black economic empowerment partner CellSAf filed court papers in March 2016 seeking to begin liquidating 3C Telecommunications, Cell C’s holding company. CellSAf accussed the company of being insolvent.

Telkom ended talks about an acquisition of Cell C in 2015, due to a difference of opinion over price.

If Telkom did buy a stake in Cell C, it could expand its mobile operations and compete with Vodacom and MTN. It has been cutting jobs and investing in broadband and mobile to counter falling demand for landline services, the Bloomberg report said.