Nasdaq-listed Magic Software Enterprises (MSE) has signed a purchase agreement for a 51% stake of its South African distributor, Magix Integration.
Magix Integration was initially bought by MGX in 2003.The deal, which became effective on 1 January, will see Magix Integration split into two companies - Magix Integration and Magix Security.
Incumbent Magix MD, Hedley Hurwitz, will head up Magix Integration, while Chris Hills, who previously held the position of chairman, will be the MD of Magix Security.
Growth plans
MSE will initially acquire 51% of the new Magix Integration division; however, the company says it is considering increasing its holdings to 75% over the next year, depending on the company meeting specific profit and revenue goals.
In a statement, Guy Bernstein, acting CEO of MSE, says the deal expands the company's global operations into Africa and will establish its presence in the region.
Hills told ITWeb that the agreement fits both parties' expansion plans into the African continent. “Magix Integration benefits by getting the sales and marketing support from MSE and MSE will be focused at finding suitable targets for acquisitions in southern Africa.”
New horizons
According to MSE, Magix Integration will continue to promote, distribute and support MSE's products and will continue to focus on providing integration and bespoke software solutions and services for its clients.
Hills adds: “MSE sees Africa as a growth market for opportunities. They have the capital and long-term view to build this market and currently operate in 13 countries and it will fuel our growth as well.”
Hills points out that the deal will result in no retrenchments and it will be “business as usual”.
Magix Security will operate as an independent business and will continue to provide IT security and insider threat products and services focused on insider threats.
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