T-Systems South Africa signs Arivia.kom deal

As part of the agreement, T-Systems South Africa will acquire 100% of the shareholding in arivia.kom, previously owned by state-owned enterprises (SOEs) – Eskom and Transnet – while simultaneously taking over the IT service contracts for both SOEs for a contract period of five years. Eskom and Transnet are arivia.kom’s largest customers currently.

The agreement comes after a rigorous and extensive selection process which examined tenders from a number of leading ICT companies. The contract, which starts in January 2010, will deliver substantial cost and business efficiencies to the SOEs through economies of scale and the transfer of core processing and support activities required to run Eskom and Transnet’s IT environments.

“We are very excited about this opportunity. Not only does it mark a significant milestone in T-Systems’ long-term growth strategy,” says Mardia van der Walt-Korsten, Managing Director of T-Systems South Africa, “but it also affords us an opportunity to be part of enhancing the IT operation of two of the most important contributors to the success of our economy. We are committed to building long-term, mutually beneficial relationships, as well as delivering continuous improvements through the services we offer.”

In 2006, Eskom and Transnet embarked on a strategic restructuring process with the objective of disposing non-core business which included their respective shareholdings in arivia.kom. The resulting tender was aimed at selecting a leading ICT services provider that could take over the IT services contracts as well as the shareholding in arivia.kom

Dr. Steve Lennon, Managing Director for Eskom’s Corporate Services Division says “For Eskom, this is an important milestone, a step in the right direction. In these challenging times of our company’s history, it is important for Eskom to focus on its core business. Awarding our IT support contract to a reputable provider whose capabilities outperform our own, and who can deliver enhancement and innovation at a lower cost will deliver benefits to  our enterprise in the form of improved service levels and savings that can then be reinvested in other initiatives.”

“We are pleased to finally conclude the deal with T-Systems”, says Transnet’s acting Chief Executive, Chris Wells, “Transnet’s focus is to obtain a more cost-effective service, improved infrastructure availability and stability and enhanced end-user experience.”
 
The acquisition has been financed by T-Systems South Africa’s principal, Deutsche Telekom, and the South African operation shall retain its 30% Black Economic Empowerment structure.

In addition to the Eskom and Transnet accounts, T-Systems South Africa will be acquiring other key arivia.kom customer accounts including Airports Company SA, the State IT Agency (SITA) and the Department of Water and Environmental Affairs.

“Our customers remain the most important part of our business and we will continue to deliver an excellent service to all the T-Systems customers. The integration impact will be managed in such a way that we do not have a negative influence on any of our current or new customers’ service deliveries,” concludes van der Walt-Korsten.

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T-Systems South Africa signs Arivia.kom deal