Global IT giant buys DiData share in EDS Africa

In one of the largest ever foreign investments in the South African information technology sector, EDS Corporation has acquired Dimension Data Holdings` 50% share in its subsidiary, local IT outsourcing leader EDS Africa.

According to Tim Ryan, chairman of EDS Africa, the investment is proof of the company`s faith in the South African economy and in the company`s potential in South Africa.

EDS is eager to capitalise on the huge opportunities that are emerging as the local business environment becomes increasingly globalised, connected and information-driven, he said.

"Internationally EDS has re-energised itself, and is reclaiming its leadership of the IT services industry that it created some 35 years ago.Part of this process is the re-alignment of the company into four main lines of business that extend across industry sectors and across geographies. As 100% owners of EDS Africa we will be able to exploit much more fully the huge potential of this re-alignment, and tap more directly into our global skills, resources and information. We all stand to benefit, but none more so than our clients."

Dimension Data agreed to sell its share in EDS Africa because of a fundamental shift in its strategic direction.

EDS Africa and Dimension Data will continue to work closely together. The acquisition agreement includes an earn-out clause in terms of which Dimension Data will continue for several years to share in the financial success of EDS Africa, and a bilateral preferred vendor agreement. Dimension Data is also one of EDS` major clients, and the two companies are currently bidding jointly for a large outsourcing contract.

EDS recently announced a re-alignment of its service offerings, raising its capability to meet clients` needs in an increasingly digital economy. Its four lines of business are AT Kearney (high-level consulting), business process management, Information Solutions (mainly IT outsourcing) and E.Solutions (electronic business).

"With these four key offerings," said Ryan, "we`re the only organisation that can provide an end-to-end solution to our clients` needs as the business environment goes `e`. And by making EDS Africa wholly EDS, they become much more available to our clients - a powerful set of tools capable of transforming their business and helping them to profit from change."