Set-top box manufacturer and Altech subsidiary UEC has unveiled a 25% (plus one share) empowerment deal with three black-led investment businesses. The value of the transaction has not been disclosed.

In what is probably part of a bid to prepare for the coming migration from analogue television to digital television, Power Matla, Epiworx Investment and Empower a Thousand Holdings, will take up the shareholding.

Digital television will be rolled out to SA households out over the next three years, with up to 10m homes requiring set-top box (also called a decoder). About half of those boxes will be subsidised by government for the poor.

UEC is one of the biggest providers of decoders in SA and supplies companies like MultiChoice. Without an empowerment component, UEC would most likely be left out of the tender for the subsidised decoders. Government wants to boost local manufacturing as part of digital migration.

Altech is creating a holding company called Newco, which will acquire the African operations of UEC on a loan account.

The three empowerment partners will then buy the 25% plus one share stake in Newco as a consortium. Of that stake, Power Matla will own 65%, Epiworx will own 20% and Empower a Thousand will hold the remaining 15%.

“Government’s clarification on the migration standard and the industry’s recent interactions with [communications] minister Roy Padayachie are clear indications that government recognises that ICT is the catalyst for economic growth in SA,” says Altech CEO Craig Venter in a statement. — Staff reporter, TechCentral