MetroFibre buys Link Africa’s fibre assets in Gauteng, KZN
Open access fibre network provider MetroFibre has acquired the fibre-to-the-home (FTTH) network and infrastructure of Link Africa in Gauteng and Kwa-Zulu Natal, adding another 10 000 homes passed to MetroFibre’s fibre network in SA.
MetroFibre says the deal is effective 1 April 2021 with a transition period which is expected to be completed by the end of June 2021.
The deal comes after Investec last month injected R2.5 billion debt funding into MetroFibre, to help the open access fibre network operator strengthen its fibre network rollout across SA.
This is alongside a recent R1.5 billion equity raise towards the end of 2020.
With the fibre competition heating up in SA, analysts have also predicted that this will eventually lead to the consolidation of the FTTH market.
According to MetroFibre, at the close of the deal, it will rank among the top five fibre network operators in SA in terms of number of homes passed, with its open access network currently passing over 205 000 homes in five provinces across the country.
“As part of our growth strategy, we’ll be looking at building and extending our infrastructure organically, as well as pursuing strategic acquisitions of existing infrastructure networks from fibre network operators,” says Dr Steve Booysen, MetroFibre CEO.
“The combination of organic growth, successful capital raises and a focused acquisition strategy will see MetroFibre well-placed to play a leading role in the sector’s unfolding consolidation process, elevating the business into a market-leading position. We aim to densify our existing networks to reach an additional 300 000 residential homes across the country over the next two years.”
Booysen notes that the demand for high-bandwidth Internet services, for the purposes of working from home, education and entertainment has reached a significant tipping point in SA and has been given dramatic impetus by the COVID-19 pandemic.
He adds that Internet connectivity is a key driver of economic growth in SA, alongside increasing access to education, entertainment and many other social benefits.
“The Presidency has consistently called on all sectors of society to contribute to a technologically-enabled future that brings about greater economic and social inclusion, and enhances the competitiveness of the South African economy as we embrace the fourth industrial revolution (4IR).
“Providing the infrastructure will be crucial to enabling our digital ascendancy and bringing the benefits of the 4IR to all sectors of our economy. As MetroFibre, we’re poised and committed to play a meaningful role in bringing quality, reliable access to South African homes and businesses across the country,” adds Booysen.
According to Craig Carthy, CEO of Link Africa, the sale of its FTTH assets is part of the company’s strategy to focus its business on fibre-to-the-business and fibre-to-the-tower services.
As MetroFibre is an open access provider, the company says there will be virtually no effect on the services of the current FTTH subscribers on the Link Africa network as they will simply continue their relationship with their current Internet Service Provider without interruption.