Remgro-controlled fibre telecommunications operator Vumatel has acquired a 45% non-controlling stake in fixed-wireless and fibre Internet service provider Herotel.

Herotel’s focus has mainly been on rolling out Internet access using both fibre and fixed-wireless technology in unlicensed spectrum bands in smaller towns and cities in South Africa. It has a presence in about 400 towns and cities across the country.

“Herotel will benefit from this deal by immediately being able to continue its plans for the deployment of fibre connectivity solutions in South Africa’s secondary cities and towns – effectively allowing more people throughout the country to access unlimited high-speed Internet,” said Vumatel CEO Dietlof Mare in a statement.

Francois Wessels, chief financial officer at Herotel, said: “Herotel‘s vision is to connect as many South African communities to faster, more affordable Internet as possible, and we’re confident that this deal will help accelerate this vision.”

“Vuma will continue building, owning, and operating high-speed fibre-to-the-home networks using a wholesale open-access model,” said Mare. Vuma’s model has so far passed just under 1.5 million homes and deployed over 31 000km of fibre infrastructure across South Africa.”

Mare said in an interview with TechCentral that the investment will allow smaller towns in South Africa to move to fibre more quickly. He said there will still be a place for fixed-wireless services of the type Herotel offers, but these are more suited to rural environments than urban areas.

Two board seats

Herotel will be able to use the investment to accelerate its expansion across South Africa, Mare said. He declined to say which shareholders had exited Herotel through the transaction, but confirmed it’s the larger investors who sold. Herotel was founded by telecommunications industry veteran Alan Kn0tt-Craig Jr. Knott-Craig confirmed to TechCentral on Thursday that he has sold his stake in Herotel to Vumatel and is no longer involved in the business. He said he is currently spending his time on another of his initiatives, Project Isizwe, which is focused on bridging the digital divide in South Africa using Wi-Fi technology.

Herotel is currently led in an acting capacity by former Vodacom executive Chris Ross. The Herotel board will meet soon to decide on a permanent appointment to the CEO role. Vumatel will get two seats on the Herotel board, but Mare emphasised the stake is non-controlling and that it exerts no influence over management decisions.