Black controlled IT solutions and infrastructure provider, Datacentrix, has acquired 100% of Johannesburg-based SM Networx, an organisation of 40 skilled people active in the IT infrastructure and services arena. The acquisition enables Datacentrix to expand its presence substantially in Johannesburg, an area the company has identified as a target for future growth opportunities.
"We are effectively sticking to our knitting, just in a different geographical location. One of our stated strategic objectives is to increase our presence in Johannesburg. This acquisition marks a further step towards the end-goal that the group has in mind for its structure," says Gary Morolo, executive chairman at Datacentrix.
Integrating SM Networx in full marks the culmination of an 18-month search for an appropriate Johannesburg-based operation. SM Networx offers a strong, flat management structure, exceptional teamwork, committed staff and a strong balance sheet. A cultural and value system, which provides an excellent fit with that of Datacentrix, further ensures that integration time will be minimised, and allows Datacentrix to immediately focus on customers and the market place.
The acquisition is effective as of 1 March 2002, for the total purchase consideration of a maximum of R33 222 667, payable as R20 000 000 in cash and R13 222 667 in Datacentrix shares. The Datacentrix shares will be issued at an issue price of 100 cents per share.
Datacentrix will expand its current enterprise customer base by gaining access to the existing corporate client base of SM Networx, while being able to dip into a pool of skills and people with deep experience of the Johannesburg market.
Clear synergies exist between the two companies, with Datacentrix offering a strong black empowerment, national representation and added resources to SM Networx. A consolidated solution offering will further enhance the SM Networx business offering to its existing multi-national client base. The company will effectively become Datacentrix Johannesburg, with the current five partners remaining as management. There will be no job losses.
Says Ronelle Baker, director of SM Networx: "Our customer relationships are historic and multi-national and our skills are on par with those areas that Datacentrix operates in. The management pool of both SM Networx and Datacentrix is being strengthened through this acquisition. We have always offered turnkey solutions in the areas of outsourcing and helpdesk services, which forms a further synergy with Datacentrix`s operational areas."
"Customers from both companies will have access to a larger resource pool and more diverse skills set. This gives SM Networx` clients a more complete service offering, particularly as Datacentrix is a Compaq, HP and IBM service partner, complementing our relationship with Compaq," she adds.
Morolo concludes: "With the changes in the market, consolidation is inevitable. This acquisition will enhance the Datacentrix group`s ability to deliver to Johannesburg customers and continue our tradition of attracting quality business and people."
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