EOH, one of South Africa's largest consulting, technology and outsourcing companies listed on the software and computer services sector of the JSE, today announced that it has acquired infrastructure specialist Bromide Technologies for R30 million.
EOH executive director, Nkosinathi Khumalo said EOH stated its intention to include an infrastructure offering during it annual results presentation in September.
He says the acquisition forms part of EOH's strategy to deliver end-to-end solutions and that the group sees Bromide Technologies as a significant player in the infrastructure arena.
According to research firm BMI-T, the South African IT market is valued at R49 billion, 40% of which is infrastructure. Khumalo says EOH sees the addition of Bromide Technologies to its stable as a natural extension of the services currently offered by the Group.
"An infrastructure component fits perfectly within our design, build, operate business model. It not only complements our offerings perfectly, but can also operate as a separate entity, providing a new revenue stream for the group."
Bromide Technologies delivers an end-to-end service, ranging from networking infrastructure to ERP and back-office solutions. The company is a preferred HP partner. Delfim Alves, managing director of Bromide Technologies, says the acquisition came at an opportune time for the business.
"We were looking for innovative ways to penetrate the enterprise services space as well as grow our project revenue and the EOH acquisition was the ideal solution."
Alves says he also sees the prospect of cross-selling within the EOH Group as a massive opportunity for Bromide Technologies. "We can add significant value to all sectors of the group because there is always a need for an infrastructure solution."
Khumalo agrees and says he sees great potential for the new business unit within the private and the public sector. "As part of an empowered group, Bromide Technologies can take EOH and its new infrastructure solutions into a market the group has not yet penetrated."
Alves says another area where he sees immense synergy is with EOH's outsourcing unit, Mthombo Managed Services (M-IT). Due to the size of the company and the lack of a national sales footprint, Alves says Bromide Technologies faced significant growth challenges. Now, through M-IT, it has access to markets previously out of reach.
"The sky is the limit for us as a result of this acquisition. We have gone from being a 72-person team to being part of a 1 000-strong national organisation. It will enable us to grow the business significantly and will also provide a real value-add to EOH."
Khumalo is upbeat about the group's latest move. "There is a great cultural fit and we all share the same entrepreneurial spirit. Bromide Technologies is a significant player in the infrastructure sector and we believe the acquisition is not only strategic to the group, but a necessary value-add to an already successful services business."
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