CS Holdings gains R60m services division from FNB

First National Bank has fully disposed of its IT Customer Services division (ITCS) to CS Holdings. With anticipated first year revenue of more than R60 million, CS Holdings will incorporate the entire business of ITCS into its Managed Services division for a nominal amount. The deal includes all operational assets and liabilities of the business as well as 280 skilled staff.

The move also gives a significant boost to FNB`s BEE procurement policy because of CS Holdings` strong empowerment credentials. CSH is 25% owned by Worldwide African Investment Holdings and has significant black management and board representation.

ITCS services and maintains FNB`s ATMs, point of sale (POS) base and a wide range of desktop, networking devices and associated peripherals in SA, Namibia, Botswana and Swaziland. ITCS is also responsible for evaluation, consultancy and roll-out of new products, equipment and IT systems within FNB. Although ITCS supplies support services to other companies, it has to now been largely unable to offer similar services to other banks due to its association with FNB.

"FNB reviewed the role of ITCS within the group and believes that ITCS would be better positioned within a specialist information technology environment," says FNB Technology CIO Yatin Narsai.

"FNB regards CS Holdings as a first tier IT company, with a significant empowerment vision and structure. It was therefore selected in the evaluation process. By incorporating ITCS, we believe CS Holdings will be able to supply and maintain a credible service delivery in the challenging banking sector and ensure healthy competition in an exclusive IT services market."

According to CS Holdings CEO Annette van der Laan, ITCS is an ideal fit into the business of CS Holdings. "This agreement will enhance CS Holdings` skills-base and experience in the banking services sector, giving it a strong foothold in the very lucrative and exclusive IT services market. With limited competition in providing IT support services in the banking sector, CS Holdings will now be able to grow aggressively and compete head-on with other major players in this sector."

"ITCS has a national footprint of offices, staff and infrastructure that is very similar to CS Holdings. The integration of ITCS into CS Holdings will result in overhead cost and infrastructure savings," says Gary Lailvaux, operational director CS Holdings Managed Services.

"This agreement will not only reposition CS Holdings as a major player in this market, it will also enable CS Holdings to expand its recently obtained Nedcor ATM support services contract," adds Lailvaux. "This will also allow CS Holdings to fast track its business objectives of organically growing its market share in the financial and banking sector."

In its decision, FNB recognised the fact that CS Holdings has strong BEE credentials and is actively leading the drive to transform the South African ICT environment. "CS Holdings has demonstrated its commitment to transforming the company. The fact that the company has strong BEE credentials and is also Proudly South African, played an important role in our decision," concludes Narsai.