Convergence Partners CEO Brandon Doyle said its model was to add value to the companies that it is invested in and given that it already owns stakes in Telkom and Dimension Data – which would represent conflicts of interest – an investment in Vodacom could be considered unlikely.<\/p>\n
Ngcaba said, however, that Convergence Partners already had a see-through investment in Vodacom through Telkom (Vodacom is a 50% subsidiary). Convergence Partners holds 6.73% of Telkom through the Elephant Consortium.<\/p>\n
Convergence Partners was formed in May 2006, and brings together all of Ngcaba’s BEE investments. He owns 88% of the company and acts as its chairperson, while the other 12% shareholding is split between management groupings (3% held by a black executive’s trust and the other 9% by the initial executives).<\/p>\n
Ngcaba says despite his interest in building Convergence Partners, he still spends a significant amount of his time at Dimension Data, where he is the SA chairperson. The companies also work together on exploiting opportunities and on corporate social investment projects.<\/p>\n
Although Convergence Partners estimates the gross portfolio of its investments so far is more than R7.5bn, the company itself has a net equity value of around R420m – the rest belongs to the broad-based groupings and other investors that form part of each investment, Ngcaba said.<\/p>\n
Announcing a R200m capital raising exercise from Nedbank and Makalani, Convergence Partners said it had a pipeline of exciting prospects in the IT, media and telecommunications sectors in South Africa, Africa and the Middle East. It says this capital will enable it to conclude future transactions worth more than R4bn through structured deals to raise additional debt funding.<\/p>\n
Ngcaba said it was looking closely at investing in content, and also in bulk infrastructure.<\/p>\n
It has no intention of getting into pay TV directly, but said it would work with Telkom Media on various initiatives.<\/p>\n
Future investments were more likely to be in smaller companies with new technologies that could grow significantly, than into existing companies whose growth may have reached a plateau, Ngcaba said. Doyle said these might not necessarily be traditional BEE opportunities.<\/p>\n
Aside from the stake in Telkom, and the 25.01% stake in Dimension Data South Africa (though a broader BEE consortium), Convergence Partners – along with its various individual partner investors in each deal – also owns stakes in various other companies in the sector. These include Britehouse (software application companies PebbleTree, 3Fifteen and Auto-mate, as well as 30% of listing ICT staffing company Paracon), WiMax implementer Comsol and Gemalto South Africa; a SIM and EMV card provider. There’s also a stake in Inala; a solutions, maintenance and support services provider to mobile operators.<\/p>\n
Convergence Partners also owns a very small share in Nedbank through the Eyethu Corporate Customer Scheme, but Doyle said this did not signal that it would make other investments in the financial services. He says rather it will remain focused on its niche areas of technology, media and telecommunications.<\/p>\n
Ngcaba said it had also formed the Convergence Partners Foundation to invest in education and empowering black women and had so far distributed more than R1m towards various projects.<\/p>\n
While most of the dividends from the investee companies go towards paying down their individual funding structures, there was a trickle dividend from Telkom, which enabled it to start spending some money on corporate social investment projects through the trust. It would spend significantly more once it started realising value from the various other investments, Ngcaba said.<\/p>\n
Finweek<\/em><\/p>\n <\/p>\n <\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" ANDILE NGCABA’s investment company Convergence Partners is not likely to emerge as a contender in the Vodacom black economic empowerment (BEE) transaction, which, it is anticipated, will be announced before the end of the year.<\/p>\n","protected":false},"author":77,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[17],"tags":[],"class_list":["post-918","post","type-post","status-publish","format-standard","hentry","category-technology"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/918"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/77"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=918"}],"version-history":[{"count":0,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/918\/revisions"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=918"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=918"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=918"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}