Striata says it will benefit from a black economic empowerment (BEE) deal with J&J Group at the strategic and operational levels and not just on a scorecard.
The company announced this morning that it had sold a 25.1% stake in its South African operations to J&J Group for R4.5 million.
Striata CEO Michael Wright says Striata has reconstituted to form a new entity to house the South African business. Recently established offices in New York, London and Australia are excluded from the deal.
The new entity will have five directors, two of whom will represent J&J, he says.
Striata's bandwidth is provided by Icoza, a company in the J&J stable, and this became a starting point for talks with J&J with regard to a broader BEE deal.
Wright says the process that led to the deal began in May last year. "We didn't want to rush into anything. We wanted a partner with the same culture as us, not a VC [venture capital company], not fronting."
Striata develops software focused on electronic communications, including electronic billing.
"We were looking for a strategic investor as well as a BEE investor, and there are very few around. They are by far the only crowd out there I would have chosen."
He says Striata also needed someone to help it to go to another level, beyond start-up thinking into a strategy for growth.
"And we don't have to go through a whole realignment - they just fit in perfectly. So we don't need to go through that pain."
Wright says some of the benefits of the deal are immediate. "There are a hell of a lot of synergies with other companies in their stable. Several will be able to use our solutions immediately."
J&J Group chief operating officer Chris Jardine says J&J foresees "enormous growth" in software and services in the electronic communications area.
"There are many opportunities to package the offerings of the companies in the group, and we are already working on joint business prospects with the likes of Faritec," he says.
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