South African regulators, the Competition Commission and the Independent Communications Authority of South Africa (ICASA), have unconditionally approved the transaction in which Convergence Partners will buy systems integrator Datacentrix.
In January, Convergence Partners announced its Convergence Partners Digital Infrastructure Fund (CPDIF) had entered into a definitive agreement with Alviva Holdings to acquire 100% of the systems integrator for an undisclosed amount.
The agreement was subject to the fulfilment of conditions and regulatory approval. According to Datacentrix, all conditions precedent have been met.
The acquisition deal, which includes the existing Datacentrix management team, came after businessman Andile Ngcaba’s Convergence Partners last year successfully closed the CPDIF at $296 million (R5.1 billion), surpassing its initial target by over 18%.
“I am thrilled to welcome Convergence Partners to our family and look forward to working with the team to create exceptional business outcomes and to pave the way for a sustainable future,” says Ahmed Mahomed, group CEO of Datacentrix.
“We are heartened by the engagement to date with Andile Ngcaba and the rest of the Convergence Partners team, Stefan Ferreira and Ruveshan Moodliyar, and we look forward to leveraging this new partnership for the benefit of all stakeholders.
“Datacentrix’s roots are firmly planted in South Africa and has ambitions to continue expanding its reach further into the continent and beyond. We look forward to continuing the Datacentrix success story well into the future. The group is well-poised to deliver unparalleled value to its broad client base across Africa and the Middle East.”
Ngcaba, chairman of Convergence Partners, adds: “We are delighted to be part of Datacentrix, one of the leading system integrators in South Africa.
“We are excited to embark on this journey towards artificial intelligence (AI) with Datacentrix. We are entering Datacentrix at a time when the market is transitioning towards an AI-driven enterprise, telco and public sector. With Datacentrix’s strong partnerships with leading global OEMs [original equipment manufacturers], we will be forging new partnerships as the market consolidates.”
Datacentrix was a subsidiary of Alviva from February 2017 after Alviva finalised the acquisition of the remainder of shares of Datacentrix that it did not already own in January that year.
At the time, Alviva said it paid out R563 million for the acquisition, although the original amount reported when the deal was first announced was R541 million.
Alviva is exiting Datacentrix pursuant to its delisting from the JSE in early 2023, to focus on its core operations in hardware distribution.
Datacentrix is an ICT systems integrator that provides solutions and services across the information value chain.
It listed on the main board of the JSE in 1998 and delisted on 14 February 2017, after being acquired by Alviva.
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