South Africa: Seacom to buy 100% of FibreCo

Seacom said on Wednesday that it has reached an agreement to buy 100% of national open-access fibre provider FibreCo for an undisclosed sum.

Speculation about an impending acquisition, which is being done through Seacom’s South Africa unit, first surfaced in August.

The acquisition is subject to approval by the Competition Commission.

Seacom said in a statement that the deal represents a “milestone” in its “vision to expand its African footprint through the consolidation of fibre assets”.

“Seacom believes this is necessary for the evolution of the market, particularly as we move into the 5G environment with its requirement for pervasive fibre networks.”

Seacom, which built the first subsea fibre broadband cable along Africa’s east coast to Europe, connects South Africa to the east coast of Africa, India and Europe, while FibreCo connects over 60 points of presence across South Africa, including data centres in Johannesburg, Cape Town, Bloemfontein, Durban, Port Elizabeth and East London.

FibreCo’s network also connects to the Seacom subsea cable system, which lands in Mtunzini, north of Durban, and to the Wacs cable, which lands at Yzerfontein on the west coast. This infrastructure provides “fully redundant, high-speed ring protection for diversity around the African continent”, Seacom said.

‘Underserviced’

“The FibreCo acquisition significantly strengthens Seacom’s operations in South Africa by creating a platform for the expansion of its business services,” it added. “It enables the delivery of high-speed Internet connectivity and cloud products into smaller cities and towns across the country, which have typically been underserviced.”

Founded nine years ago, FibreCo was jointly established by businessman Andile Ngcaba’s Convergence Partners, Dimension Data’s Internet Solutions and mobile operator Cell C.

Earlier this year, Seacom acquired Cape Town-based Internet service provider MacroLan for an undisclosed sum. This deal was “in line with Seacom’s strategy to extend the reach of its fibre network to more metropolitan areas across South Africa, as well as to bolster its managed services capability for business customers”, it said.

Seacom’s shareholders are South African businesses Remgro (30%), Sanlam (15%), Convergence Partners (15%), Kenya’s Aga Khan Foundation (30%) and founder Brian Herlihy (10%).

Source: NewsCentral Media