VAST Networks for sale – Sources

Industry sources have told MyBroadband that VAST Networks, which is owned by Dimension Data and Naspers, is for sale.

VAST Networks was established in 2015 as a joint venture between Dimension Data and Naspers, which own 51% and 49% of the company respectively.

The company is an open-access Wi-Fi network infrastructure provider, delivering carrier-grade Wi-Fi in Southern Africa.

Although an open-access Wi-Fi network may not be perceived as very valuable, the company’s often-exclusive agreements with malls and businesses are a good asset.

Mobile networks

Mobile operators are looking at ways to improve their network capacity and performance, and LTE in unlicensed spectrum (LTE-U) is one possible solution.

LTE-U makes use of unlicensed spectrum, such as the 5GHz band, which lets operators improve data performance without requiring a user to log in to a separate Wi-Fi network.

A mobile operator using LTE-U needs multiple microcells (similar to Wi-Fi hotspots) using unlicensed spectrum to offload traffic from its sites which use licensed spectrum.

In South Africa, where mobile operators are starved of spectrum, an LTE-U network can be highly valuable.

However, without the rights to roll out microcells in areas like shopping malls, establishing an LTE-U network will be challenging.

VAST Networks can assist operators in this regard – helping them improve their network performance.

According to sources, local mobile operators have been in discussions regarding the acquisition of VAST.

Investor exit

There has also been speculation that Andile Ngcaba, who served as chairman of Dimension Data Middle East and Africa, was against the sale of VAST.

The sale was allegedly one of the reasons Convergence Partners Investments, headed by Ngcaba, pulled out of Dimension Data.

Convergence Partners Investments has dismissed the rumour, though, as the exit was a contractually-predetermined event.

“The contractual investment term ended in September 2016, the negotiation of the terms of the exit were finalised in June 2017,” it said.

Dimension Data and Naspers declined to provide comment to MyBroadband on the matter, stating they “do not respond to market rumours”.

Now read: Convergence Partners exits Dimension Data

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VAST Networks for sale – Sources