The investment vehicle of South Africa’s richest man, Remgro Limited has finally bought fibre provider Vumatel Pty Ltd. This deal will help Johann Rupert, consolidate his presence in the country’s expanding broadband infrastructure industry. This comes three months after the company announced that it was in talks to acquire Vumatel.
According to an emailed statement to Bloomberg, Community Investment Ventures Holdings (CIVH), in which Johann Rupert’s investment vehicle, Remgro is the biggest shareholder, took a 35 percent stake in the fibre provider and has agreed to take full ownership at a later date.
However, the company didn’t say how much it will pay but Bloomberg in March reported that people familiar with the deal said that it would give an equity value of closely-held Vumatel of about R1.1 billion ($93 million). Vumatel is likely to merge its services with its rival Dark Fibre Africa and if the need to raise fund arises they may consider listing on the Johannesburg Stock Exchange.
The deal would also see Dark Fibre owned by CIVH, expand into South Africa’s fast-growing fibre-to-home industry, which Vumatel helped to pioneer after entering the market in 2015. Households in cities such as Johannesburg, Cape Town and Durban are increasingly seeking higher speeds and more capacity to handle rising consumption of data for services including streaming.
This talks between Dark Fibre and Vumatel started in October and could be concluded within the next two months. The banks that handled the deal include Standard Bank Group Ltd. and Investec Ltd.
Dark Fibre has raised R1.25 billion ($96 million) in debt funding and extended a revolving credit facility to R1.1 billion to fund expansion.
According to the Bloomberg Billionaires Index, Rupert has a net worth of $7.91 billion while Remgro also owns stakes in international private hospital operator Mediclinic International Plc and South African spirits maker Distell Group Ltd.