The world is changing fast and to keep up you need local knowledge with global context.
JOHANNESBURG — From starting as a small fibre-to-the-home (FTTH) project in Johannesburg’s Parkhurst in 2014 to becoming the chief disruptor on a national level in high-speed internet in South Africa, Vumatel has made some serious waves in the country’s ICT landscape. Now it’s on the cusp of an even bigger deal: potentially being snapped up by Remgro. A Bloomberg report says that talks are at an advanced stage and that if the deal falls through, Vumatel may even consider listing on the JSE. This is a great development for South Africa amid Telkom continuing to dominate the fixed-line space in South Africa. – Gareth van Zyl
By Loni Prinsloo
(Bloomberg) – Remgro Ltd. is in advanced talks to buy fibre provider Vumatel Pty Ltd. as South Africa’s richest man seeks to consolidate the country’s expanding broadband infrastructure industry, according to people familiar with the matter.
A deal by billionaire Johann Rupert’s investment vehicle would give an equity value of closely-held Vumatel of about 1.1 billion rand ($93 million), said the people, who asked not to be identified as the talks are private.
Rupert would then combine Vumatel with rival Dark Fibre Africa, in which Remgro owns a majority stake, the people said. The deal could still fall through, and if so Vumatel would consider selling shares on Johannesburg’s stock exchange, they said.
A spokesman for Dark Fibre declined to comment. A spokesman for Remgro said she didn’t have an immediate comment and Vumatel couldn’t immediately be reached for comment.
The deal would allow Dark Fibre, which has a network of about 10,000 km (6,214 miles), to expand into South Africa’s fast-growing fibre-to-home industry, which Vumatel helped to pioneer after entering the market in 2015. Households in cities including Johannesburg, Cape Town and Durban are increasingly seeking higher speeds and more capacity to handle rising consumption of data for services including streaming.
Dark Fibre trails Econet Wireless Global Ltd. unit Liquid Telecom in terms of network size. The company has raised 1.25 billion rand in debt funding and extended a revolving credit facility to 1.1 billion rand to fund expansion, according to its website.
Talks between Dark Fibre and Vumatel started in October and could be concluded within the next two months, said the people. Banks working on the deal include Standard Bank Group Ltd. and Investec Ltd., one of them said. Neither lender could immediately be reached for comment.
Rupert has a net worth of $8 billion, according to the the Bloomberg Billionaires Index. Johannesburg-based Remgro also owns stakes in international private hospital operator Mediclinic International Plc and South African spirits maker Distell Group Ltd.
Cyril Ramaphosa: The Audio Biography
Listen to the story of Cyril Ramaphosa's rise to presidential power, narrated by our very own Alec Hogg.