Jasco expands telecoms business

By Staff Writer for Jasco

Johannesburg, 08 Jul 2009

Electronics manufacturer Jasco has purchased a 30% stake in Maringo Communications, for R4 million.

Jasco says the deal will allow it to potentially increase its stake in Maringo by an additional 20% and one share, giving it a majority stake within the next two years.

The company will also acquire 30% of Maringo Software Solutions, a non-trading entity that exists to hold the licence rights of software used in Maringo's Compliant Archiving Solution service offering.

Jasco says it will pay a maximum of R34 million for the majority stake in the company, depending on Maringo's profitability. Maringo incurred a loss after tax of R2.14 million in the nine months to March and further losses are expected in the short-term.

However, Jasco will assist the unit to turn around through marketing its products and a R4 million loan.

Maringo is one of five enhanced channel partners of Vodacom Business, which is part of the Vodacom Group.

It also provides turnkey IT services and solutions as an add-on to the Vodacom Business offering. As there is an increasing requirement for compliant business data storage, Maringo's Compliant Archiving Solution can address regulatory requirements in a growing market, says Jasco.

Jasco says the deal will enable it to cross-sell Maringo's offerings to its security and domestic products divisions. It will also aid its African growth strategy and save costs as the company will be able to internally source value-added services for its own telecommunications and IT, instead of acquiring these externally.

Growth plans

Jasco says the acquisition will allow it to acquire a controlling share in a converged ICT business at an attractive value. The deal meets Jasco's objective of growing the group into complementary areas, such as expanding on its security offerings.

Its security division, which is made up of Multivid and Scafell, designs, supplies, installs and maintains electronic security systems. Jasco says it is working with Maringo to develop electronic security solutions for gated communities, such as townhouse complexes, and industrial parks.

In the telecommunications sector, Jasco provides solutions, products and services to access networks of both fixed-line and wireless telecommunications operators, through a combination of designed and manufactured in-house products and those sourced from overseas technology players.