Naspers has revealed that it sold MWEB to Dimension Data division Internet Solutions for $10 million (around R130 million) earlier this year.
Naspers said the transaction only involved the consumer ISP part of the business, and included the last tranche of what was still owned by MultiChoice SA.
At the same time, Naspers and Dimension Data entered a joint Wi-Fi business venture called VAST, where Dimension Data owns 51% and Naspers owns 49%.
The $10-million price tag for MWEB may surprise many people, especially after MTN bought its controlling stake in Afrihost in 2014 for R408 million.
MTN purchased 50% plus one share in Afrihost, which means that the company was valued at R916 million. This is significantly higher than the R130 million which MWEB’s consumer division fetched.
It must be noted that Afrihost’s valuation may have been higher due to its large hosting division.
Afrihost bought back its shares from MTN in 2016 for R325 million, which valued the company at R650 million.
MWEB has traditionally had a larger subscriber base than Afrihost, which means other elements may have caused the lower price for MWEB.
Naspers did not release MWEB’s financials, which means it is difficult to know what position the ISP was in at the time of sale.
It could be assumed that its financial situation was significantly worse than Afrihost, due to the price difference.