The local arm of US outsourcing giant EDS has sold a 20% stake to the Koketso Gravitas Consortium, which has several luminaries among its shareholders.
A further 10% of the shareholding will be placed in an employee trust for the benefit of EDS SA staff.
The value of the deal was not disclosed.
A statement issued today says the consortium was specifically established for this transaction. It includes as key shareholders Bongani Khumalo, former Transnet chairman and current chairman of Grey Global Advertising; Dali Tambo, one-time TV personality and son of former ANC secretary general Oliver Tambo; Mandla Langa, former ICASA chairperson; and Dali Tambo`s mother, Adelaide Tambo, who leads the Zwelonke Mothers Union.
The Zwelonke Mothers Union, a broad-based women`s group representing over 45 worship groups on the East Rand, undertakes a range of social initiatives in the community.
Future deals
Khumalo, head of the Koketso Gravitas Consortium, says the deal means his party is entitled to at least one seat on the board of EDS South Africa, but it has ambitions to increase its stake as the opportunity arises.
He adds that while the consortium was put together specifically to enable this deal, it would consider others as well.
"Naturally, future deals will be done in consultation with our EDS partners."
Khumalo says the objective of the deal is to give a black empowerment consortium such as this the opportunity to enter the ICT industry and help EDS expand its presence in SA and the rest of the continent.
Local conditions
In 1999, IT group Dimension Data sold its 50% stake in EDS South Africa back to its US principal for an undisclosed amount. At the time, Dimension Data stated the transaction valued EDS South Africa at just under R1 billion.
EDS South Africa commercial director Ian Pluke says the deal is part of the reality faced by many large multinational companies in dealing with local conditions.
"This is a way in which we can merge the requirements of a large American company with the requirements of the conditions that a local subsidiary has to face," he says.
Facts and figures
EDS South Africa was formed in 1995 and is a fully-fledged part of EDS Corporation, a $20 billion global IT services giant represented in over 60 countries. The local operation is headquartered in Sunninghill, Johannesburg, with a branch in Rondebosch, Cape Town.
The South African operation manages IT service delivery for both local and global clients from a data centre in Senderwood. Clients include Anglo American Platinum, Impala Platinum and South African Airways.
In February, EDS, ranked as the world`s number two technology-services provider, reported that fourth-quarter net income increased to $112 million, or 21c a share, from $53 million, or 10c a share, in the year-ago period.
The US group says it expects to report full-year 2006 revenue of $20 billion to $20.5 billion, up from $19.8 billion in 2005.
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