Private equity firm Actis has announced a R2.3-billion (US$140 million) deal to acquire a majority stake in Octocel – Cape Town’s largest Open Access Network focused on both Fibre-to-the-Home (FTTH) and Business (FTTB).
Actis has also acquired a non-controlling stake in RSAWEB, a South African ISP, for an undisclosed amount.
Authorisation of both deals is subject to standard regulatory approvals and the founders of both companies, Rob Gilmour and Mark Slingsby, will remain shareholders in the companies.
David Cooke, Private Equity Partner at Johannesburg-based Actis said: “Octotel and RSAWEB are the latest Actis investments into the high growth digital infrastructure sector. We have a growing portfolio of datacentre investments and are delighted to now be making our first investment in the fibre sector.”
Cooke added that the investment was driven by the demand for reliable, high quality, high speed digital access in the home.
“We see first-hand the impact that affordable connectivity has in communities in South Africa for work, entertainment and education,” he said.
The shares acquired by Actis were sold by publishing and printing group Caxton. Justifying the sale, Caxton said Octocel and RSAWEB needed focused shareholders that would take the ventures to the next level.
Caxton is expected to receive nearly R500-million when the deal is completed. Actis secured the stakes via its private equity fund Neoma Africa Fund.
Octotel provides open access fibre optic connectivity while RSAWEB provides cloud services, web hosting, datacentre services and broadband.
However, this is not Actis’ first major tech commitment in Africa. In March 2020, it announced the establishment of a US$250-million pan-African datacentre platform. In a statement, it said the buy- and-build platform will comprise independently-owned carrier-neutral data centres across key African markets.
The first of these investments has been completed with Actis taking a controlling stake in Nigeria’s leading, independent, co-location business, Rack Centre.
“We have been tracking the datacentre market in Africa closely, building relationships with key operators and customers. Africa is at an inflection point and we expect to see an explosion in growth of demand for hosting capacity in independently-owned datacentres across the continent,” said David Morley, Head of Real Estate at Actis.