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Netstar close to a deal

Nicola Mawson
By Nicola Mawson, Contributor.
Johannesburg, 25 Apr 2012

Vehicle tracking company Netstar, a subsidiary of JSE-listed Altech, is close to inking a deal to buy a company in Latin America.

Netstar broke through the R1 billion revenue mark for the first time in the year to February and added 20 151 vehicles to its subscriber base. Altech says Netstar has good prospects, especially in the government and state-owned enterprises market, where a number of mid-sized tenders have been secured.

Altech CEO Craig Venter says Netstar is close to buying out a company in Latin America, which will give it access to growth markets such as Argentina, Brazil, Colombia and Mexico. In September 2010, Altech was close to signing a deal but walked away.

Should the acquisition go through, Netstar will be the largest vehicle tracking company in the world, Venter adds. Altech has been looking for an acquisition, but has binned two deals over concerns that came up during due diligence.

Netstar claims to have pioneered the stolen vehicle tracking and recovery industry in SA in 1994. It employs more than 800 people, based at its head office in Midrand, regional offices in Durban and Cape Town, and branches in Port Elizabeth, Rustenburg, Richards Bay, Newcastle, Witbank, Bloemfontein, Polokwane and Nelspruit.

Venter says offshore growth for Netstar is a priority and the technology partnership with Italy-based Octo Telematics has seen it heading towards its target of 2 500 connections a month, with significant potential for the development of insurance telematics throughout Africa.

Altech views telematics as a future growth driver as insurance companies are increasingly interested in driver behaviour. The company is also developing value-add services in fleet management such as dynamic routing and a bureau service.

Netstar continues to look at international opportunities for potential business partners to increase its global footprint.

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