Nairobi — South African technology company, Altech has acquired stake in Kenya Data Networks (KDN), Infocom Uganda and Swift Global Kenya at a combined price of US$85.2 million.

The triple acquisition, which became effective on March 1, 2008 will see Allied Technologies Limited (Altech) take up a 51% controlling stake in leading Kenyan IT firm KDN (part of Sameer Group), Infocom and Swift Global.

"These acquisitions support our strategy of moving up the telecoms value chain, expanding our geographic presence in Africa and operating at technology's cutting edge," Altech chief executive, Mr. Craig Venter said.

Altech will pay a total cash consideration of $75 million for its 51% interest in KDN, Swift and Infocom. Of the total $75 million, $10 million will be held in escrow, pending achievements of an agreed combined profit after taxation of KDN, Swift and Infocom, for the twelve months ending December 31, 2008.

In addition, $20 million in new capital will be injected into KDN, Swift and Infocom - 51% will be provided by Altech and 49% by Sameer and its associates.

The partnership with Altech is aimed at boosting KDN, Infocom and Swift operations in the East African region alongside its planned rollout to the larger East and Central Africa region.

Mr. Naushad Merali, the group chairman of Sameer Africa said partnering with Altech is in line with the group's policy to look for strong strategic partnerships with the aim of increasing the portfolio of products and services and improving the service quality offered.

We identified Altech as the perfect fit for our pan African strategy and expansion, said Merali.

The acquisition is the latest in a buying in spree especially in the ICT sector involving Kenyan companies with their eyes set on the regional market.

This is also aimed at raising the requisite capital necessary for investment in the planned construction of lucrative fibre optic cables in the region.

KDN is one of the leading full service digital communications operators in Kenya whose infrastructure includes a fibre line from Mombasa to Nairobi, 450km of fibre in Nairobi, a fibre link to the Uganda border (ADSL services to the ISPs) over 450 WiFi (wireless local area network) hotspots and a satellite based international gateway.

The company offers access to its network at wholesale rates to Internet service providers and large corporate customers.

KDN has an international gateway licence for Kenya and advanced plans to expand to other African countries, including the DR Congo, Rwanda, Uganda, Tanzania, Burundi, Zambia and Malawi.

Swift Global is a leading Internet service provider in Kenya and Tanzania. Utilising KDN's infrastructure and network capacity, it provides corporate virtual private network and wireless solutions, as well as VoIP (voice over internet protocol) services.

Its products are aimed mainly at business users as contract customers. Swift purchases a large portion of the installed capacity of KDN, resulting in a close relationship between these two companies.

Infocom on the other hand offers broadband, Internet and IT services in Uganda. Infocom commenced business in 1995 before later becoming a division of Celtel (then MSI).

It has comprehensive agreements with Celtel with respect to the co-location of equipment in the cell phone operator's facilities and other services provided by Celtel. The company operates a Wimax network and satellite based international gateway.

Sameer Investments Limited is the holding company of a group of operating entities in East Africa (Sameer Group). Besides its shareholding in KDN, Swift Global and Infocom, Sameer also has interests in Dimension Data Solutions and Celtel Kenya. "The acquisitions provide us with access to Sameer's regional expertise," says Venter, adding that Altech and Sameer have forged an alliance to pursue opportunities in the region.