Datatec, ALT form new BEE force in IT
The Datatec businesses should contribute 500 million rand to the combined entities’ revenue while the African Legend businesses are estimated to contribute 300 million rand, Datatec said in a statement.
Datatec will have a 55% shareholding and African Legend Technologies will hold the remaining 45% in the newly merged entity to be known as African Legend Indigo.
African Legend Indigo will include Datatec’s RangeGate and the two African Legend Technologies businesses – African Legend Indigo Pty (Ltd) and African Legend Solutions Pty (Ltd).
Westcon AME, Datatec’s networking equipment distributor, will continue to operate as a stand alone business. However African Legend Technologies will take a 45% shareholding in Westcon AME.
The comparable size and nature of the merged operations is such that no vendor finance will be required to facilitate the deal. The proposed merger is subject to competition commission approval.
African Legend Indigo will be led by Chief Executive Officer Michael Jacobus, who has led African Legend Indigo (Pty) Ltd for the past three years. Key African Legend and Datatec executives will take positions on the new board.
According to Jens Montanana, CEO of Datatec, the merger will create a truly black empowered ICT company.
"We are excited about this deal on a number of levels. The merger will create an IT company that is 45% black owned, which is significantly more than the ICT Charter calls for, and we expect it to add significant shareholder value by providing us with the critical mass we need to take the new business to the next level and to consistently achieve the sort of growth recorded by
Datatec’s other operations in the US, the UK and Europe over the past 12 to 18 months."
Mashudu Tshivhase, Chairman of African Legend Indigo and African Legend Technologies, said the fit between the African Legend companies and RangeGate is excellent.
"Culturally there are great synergies," he says. "And there is a limited overlap in our client base which presents great opportunity for cross selling our services across the business. Through the merger we will build a strong organisation that will be in a position to make a positive contribution to bridging the digital divide throughout the whole African continent."
I-Net Bridge || Discuss this article
Loading ...