Swicon sells stake to BEE group

By Kaunda Chama, ITWeb features editor
Johannesburg, 02 Jun 2006
Swicon, a SAP HR and payroll business solutions provider, yesterday announced its sale of a 45% stake to Seemahale, a black-owned investment holding company focused on the technology sector.

Although both parties declined to state the exact purchase price, they confirmed it was a 25% cash and 75% guarantee transaction, resulting in Seemahale owning slightly under half of the R20 million Swiss-controlled company.

"Although we meet the government requirements in terms of employment equity and BEE procurement, we decided to do this deal to show our commitment to true black empowerment," comments Markus Bucher, founder and MD of Swicon.

Seemahale is headed up by Dr Thabo Lehlokoe, who established the company in January. Previously, Lehlokoe was head of market development and public sector sales at Siemens Business Services. He now holds the position of non-executive chairman at Swicon.

Bucher comments that his company decided to give a 45% stake to a new company because it believes in its growth potential and the fact that it has experienced people.

Lehlokoe comments that the rationale behind Seemahale entering into the partnership is that it sees business process outsourcing soon becoming a major focus area for both the private and public sectors.

"Swicon is not just a solutions provider, it also gets involved on the operational side, and this has helped it build a very good reputation in the market. Added to this is the fact that a lot of private companies and government departments are looking for off-the-shelf solutions which Swicon specialises in," he explains.

Swicon is one of two companies that are SAP partners for its all-in-one HR and payroll for the SME market in SA, Bucher says.

He claims his company already has a good presence in the private sector and the BEE deal should give it further inroads into the public sector.

Lehlokoe says his company will hold two positions on Swicon's board and will assist it in its transformation efforts through strategy formulation and implementation.