Dimension Data Middle East & Africa chairman Andile Ngcaba is reinvesting all of his proceeds from the black economic empowerment (BEE) deal he struck with the company in 2004 now that it has vested.
The total value of the transaction that will be paid to the various BEE individuals and organisations involved in the original deal — Ngcaba is the largest of these — will be paid out nearly R1,3bn. When the deal was struck eight years ago, the value of the 25,01% equity stake in the business was R380m.
Ngcaba will reinvest his full stake back into the business, while previously disadvantaged employees who worked for Didata during the empowerment period will be paid in full on Friday, 7 September.
Through a trust established in 2004 to benefit broad-based groups — 35 from the initial nine — Didata will continue to invest in upliftment projects in poor communities in SA. The broad-based groupings have elected to remain invested and therefore to be part of the Didata ownership structure in the future. They will receive an annual “financial distribution” to expand their services and reach.
Didata group CEO Brett Dawson says the changes will not negatively affect the company’s empowerment status as a level-3 contributor. If anything, he says it may improve slightly. He adds Didata is committed to meeting the requirements of the recently published ICT black economic empowerment charter.
Ngcaba’s stake in Didata will continue to be held by his investment holding company Convergence Partners, which has interests in a range of other technology businesses, including subsea cable system Seacom and terrestrial fibre player FibreCo.
Ngcaba, a former ANC activist and a former director-general in the department of communications before he turned his focus to a business career, says he decided to reinvest in the business because of what he believes are strong growth opportunities in Africa for Didata, especially in cloud services.
Dawson says Africa remains an early adopter of technology infrastructure and because of this he believes the continent has the potential to outstrip Didata’s growth in Europe, which he says has been robust over the past year. — (c) 2012 NewsCentral Media
