A fresh investigation to confirm whether Telkom engaged in predatory practices could take another two or three years to complete, and if the verdict went against Telkom the operator was likely to face a fine of R450m at most, said analyst Meloy Horn.

The Merrill Lynch report should quell shareholder jitters triggered last week when the Competition Commission found Telkom guilty of crushing competition by withholding its basic telecommunications services.

The commission recommended that Telkom forfeit 10% of its revenue.

As its revenue topped R37bn last year, a 10% fine would wipe out its net profit of R1,6bn. That risk saw its shares dive from R70 to R65,10. Yesterday the shares were on their way back up, gaining 120c to trade at R68,45.

The ruling came after an investigation into complaints lodged by private companies offering services such as internet access and e-mail facilities. The authority ruled that Telkom "has abused its dominant position by engaging in a pattern of anticompetitive practices".

The guilty verdict and the recommended fine have been referred to the Competition Tribunal, which will now stage a further round of hearings.

Merrill Lynch believes the tribunal's investigation may take two to three years, and an appeal could extend that by another one to three years.

"It is unlikely that any potential fine would be based on Telkom's total turnover, but on the related revenue from its leased lines business instead," said Horn.

"Depending on the definition of these services, the affected revenues could be anywhere between R800m to R4,5bn. A maximum 10% liability could vary between R80m and R450m."

No company has been fined the full 10% to date, Horn said.

The verdict was welcomed by the private operators as a belated victory in their battle to have Telkom brought into line by the competition authorities.

The Competition Commission found that Telkom had withheld basic telecommunication services to private operators, had threatened to cut off their existing phone lines and had threatened legal action against companies offering value added services.

However, the possibility of a further two years' investigation means that little may change in the telecommunications market unless the tribunal beats expectations by making a rapid ruling.